Keep, Moult or Cull a 72-Week Layer Flock
A 500-layer farm at 72 weeks has hen-day production of 62%, feed intake of 115 g/bird/day, feed cost of ₹32/kg, egg price of ₹4.50, cull price of ₹70/bird, and mortality of 0.1% per week. The farmer has a buyer for point-of-lay pullets at ₹180 each. Forced moulting would cost about ₹40/bird in extra feed and management, with expected 80% hen-day production for 25 weeks but delayed income by 8 weeks. Labour and fixed costs are ₹600/day. He wants to know whether to keep the flock to 80 weeks, force a moult, or cull and restock now. He has cash for only one of these choices and no other use for the shed. Egg prices are usually lowest in the next two months.
1. Calculate daily feed cost, egg revenue, and contribution margin before labour and fixed costs. Calculate the break-even egg price on feed cost alone.
Read the worked answer
Eggs per day = 500 × 0.62 = 310 eggs.
Feed per day = 500 × 0.115 kg = 57.5 kg.
Feed cost per day = 57.5 × ₹32 = ₹1,840.
Egg revenue per day = 310 × ₹4.50 = ₹1,395.
Contribution before labour and fixed costs = 1,395 − 1,840 = −₹445/day.
After labour and fixed costs of ₹600/day, the loss is −₹1,045/day.
Break-even egg price on feed cost alone = 1,840 ÷ 310 = ₹5.94 per egg.
Break-even price including the stated labour and fixed costs = (1,840 + 600) ÷ 310 = ₹7.87 per egg.
At ₹4.50, the flock is losing money even before labour is counted. The current price is far below the feed-only break-even.
2. Evaluate the three options using the numbers. What non-numeric factors could change the decision?
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Keep to 80 weeks: the flock loses about ₹445/day on feed alone, or about ₹24,920 over 8 weeks before fixed costs; with fixed costs the loss is about ₹58,520. Production is likely to fall further. This is the weakest option unless egg prices rise sharply.
Cull and restock: cull income = 500 × ₹70 = ₹35,000. Pullet cost = 500 × ₹180 = ₹90,000. The farmer needs ₹55,000 extra cash, plus money for feed until the new flock lays. He avoids the daily loss and gets a young flock, but he also loses income during the transition.
Forced moult: cost = 500 × ₹40 = ₹20,000. At 80% production, eggs = 400/day; feed at 110 g/bird = 55 kg/day, costing ₹1,760; egg revenue at ₹4.50 = ₹1,800; contribution = only ₹40/day. Over 25 weeks that is about ₹7,000, which does not recover the ₹20,000 moult cost. At current prices, moulting is not attractive.
Non-numeric factors: disease status of the flock, shell quality, pullet availability and quality, cash flow, labour, market for spent hens, egg-price seasonality, and welfare. Because egg prices are usually lowest in the next two months, keeping the flock is especially risky. The best financial choice is to cull and restock if the cash and healthy pullets are available; otherwise cull and pause rather than moult at these prices.
3. If egg price rises to ₹6.00 and feed price falls to ₹30/kg, recalculate and state whether the recommendation changes.
Read the worked answer
New feed cost = 57.5 × ₹30 = ₹1,725/day.
New egg revenue = 310 × ₹6.00 = ₹1,860/day.
Contribution before fixed costs = 1,860 − 1,725 = +₹135/day.
After ₹600/day fixed and labour costs, the result is 135 − 600 = −₹465/day. Break-even including fixed costs = (1,725 + 600) ÷ 310 = ₹7.50 per egg.
The current flock is still not covering full costs, but it is now contributing ₹135/day toward fixed costs. If the shed has no better alternative, keeping the flock short-term is less damaging than before. If restocking is possible, compare the new flock’s expected contribution over its laying cycle before deciding.
For moulting: expected 400 eggs/day × ₹6 = ₹2,400; feed 55 kg × ₹30 = ₹1,650; contribution = ₹750/day. Over 175 days that is ₹131,250, minus ₹105,000 fixed costs and ₹20,000 moult cost, leaving about ₹6,250. Moulting becomes marginally viable, but only if egg price stays near ₹6 and the flock is healthy. The recommendation therefore changes from clear culling to a choice between culling/restocking and moulting, depending on cash, pullet supply and the reliability of the ₹6 price.