An asset replacement approach for enhancing dual-system egg production in Taiwan

The Taiwanese egg industry employs both conventional caged and ethically-oriented non-caged production systems, yet potential inefficiencies can arise from using the same production parameters for both. This study analyzed data from a major Taiwanese egg producer, developing nonlinear bioeconomic models for egg production and hen mortality, revealing distinct differences between the two systems. While conventional cages optimize early production, non-caged systems offer more stable long-term egg production and lower mortality. Treating flock replacement as an asset replacement problem, simulations identified optimal replacement cycles to maximize profitability using average daily return (ADR). For caged systems, the current 456-day cycle is optimal. However, extending the cycle to 499 days in non-caged systems can boost egg production by 8.51% per flock and can increase ADR by 8.72% per hen over the same duration. Overall, these findings highlight the need for tailored management strategies and demonstrate the economic viability of the more ethical non-caged system.