"Is this more (or less) sustainable than the alternative?"
We produce enough eggs for my family so that we don't have to buy eggs from elsewhere (and fetch them from that supplier). We also produce a few surplus eggs (in all but the darkest, coldest months), which we sell to neighbours and friends locally. Is the production, transportation and consumption of our eggs more (or less) sustainable than my neighbours and I buying the equivalent number and quality of eggs from elsewhere, for example a supermarket 8 miles away?
The economic optimisation lens
For sure, we avoid the transport miles for the eggs, since all our customers are within walking distance. On the other hand, we have to go and purchase feed and other essentials to keep the flock fed and healthy. Because of the small size of each of these purchases, this is undoubtedly not as efficient as the supermarket's egg suppliers' operations, which are at much larger scale. By denying the supermarket the small amount of custom represented by the eggs I produce, I'm shrinking their market volumes, which in turn reduces their (and their suppliers') opportunities for optimising the benefits of economies of scale.
I haven't 'done the maths'. All in all, I suspect my sustainable approach to eggs is probably destroying a little bit of economic value in the wider market system. It's not economically optimal. So why do I do it?
The weaknesses in economic optimisation
Economic (market) forces are good at many things, including harvesting resources (eg all the raw materials sourced through supply chains) and maximising economies of scale via efficient production. However, they're not good at striking a balance between efficiency and conservation in order to achieve sustainability, especially where sustainability-inspired pricing signals and carbon taxation are weak. Markets tend to be short-term, whereas sustainability is a long-term issue. Markets often exploit resources until their scarcity drives up the cost of raw materials to the point where (most) customers will no longer pay the price of the end-product; the market collapses. If it survives at all, it is high-margin, low-volume, low-total-profit business. Unfortunately, this is often after the point where those raw materials have, in effect, been "worked out". Examples are numerous; one such in the North Sea triggered the 'Cod Wars'.
I'm looking ahead, and exploring more sustainable ways, even when this costs more in the short-term
My small-scale flock of hens is probably not the most economic way for those eggs to be produced. However, I'm anticipating a time when pricing signals and carbon taxation will strengthen in favour of sustainability, and the economic drivers and sustainability drivers will converge. I hope this time will come before the egg supply chain becomes unsustainable beyond repair.