Sustainable Fuel: USD 11.6B Used Cooking Oil Boom by 2033

From waste to wealth, the used cooking oil (UCO) market represents a harbinger of sustainability in an increasingly resource-limited world. Essential to the circular economy, UCO goes from kitchens to biodiesel plants, indirectly contributing to biodiesel production and a range of other innovative uses. With an explosion of environmental consciousness and increasingly stricter regulations, the UCO industry also benefits from recycling this oil into recyclable solutions. Europe is a key player in this highly dynamic industry, and the growing demand for renewable energy is further driving this sequential market. This report will outline key trends, challenges, and opportunities in this thriving market as UCO continues to redefine waste management and sustainability, propelling society towards a greener future by 2033.

Overview of Used Cooking Oil Market

The used cooking oil market focuses on collecting, processing, and reusing oil from homes, restaurants, and food industries. This renewable resource is turned into biodiesel, animal feed, and industrial products. It supports sustainability and cuts down on waste. Europe leads the market because of strict regulations and strong collection systems. Key players like Darling Ingredients and Olleco drive innovation in recycling technologies. Market growth is linked to increasing biofuel demand and environmental policies. This makes used cooking oil an essential part of the circular economy.

• Sources: Household, commercial (restaurants, hotels), industrial.

• Applications: Biodiesel, oleochemicals, animal feed, others.

• Key Players: Darling Ingredients, Olleco, Baker Commodities, Valley Proteins.

• Market Drivers: Biofuel demand, waste management policies.

Global biodiesel production reached 47 billion liters in 2023, per the International Energy Agency, with 15% derived from UCO. Commercial sources, like McDonald’s, supply 80% of UCO in Europe, per industry estimates. Recycling programs, such as Singapore’s Greasecycle, collect 1,000 tons annually. Industry focuses on efficient collection, with 70% of 2023 UCO processed for biodiesel. UCO’s role in reducing landfill waste and carbon emissions positions it as a cornerstone of sustainable resource management.

Market Size & Growth

Global used cooking oil market size was valued at USD 7.0 Billion in 2024. Looking forward, IMARC Group estimates the market to reach USD 11.6 Billion by 2033, exhibiting a CAGR of 5.7% during 2025-2033. Europe currently dominates the market, holding a significant market share of over 44.3% in 2024. Growth is propelled by rising biodiesel demand, supportive regulations, and expanding collection networks.

• Regional Leader: Europe, driven by EU’s renewable energy directives.

• Key Drivers: Circular economy initiatives, carbon reduction goals.

• Dominant Segment: Biodiesel application, with 60% market share.

• Growth Factors: Urbanization, foodservice industry expansion.

Market expansion aligns with a 20% rise in global biofuel consumption in 2023, per the IEA. Europe’s 44.3% share reflects Germany’s 2 million tons of UCO collected annually. Commercial sources dominate, contributing 75% of supply, driven by 1.5 million foodservice outlets in the U.S. alone. Regulatory incentives, like the EU’s RED II, boost biodiesel use, while Asia-Pacific’s urbanization fuels collection. Sustainability trends ensure UCO’s growth as a renewable resource through 2033.

Key Trends in Used Cooking Oil Market

Biodiesel Production Surge

Biodiesel production, accounting for 60% of UCO applications in 2023, drives market growth. Neste’s Singapore refinery, processing 1.3 million tons of UCO annually, produces low-carbon fuel for aviation and transport. Europe’s 44.3% share benefits from EU mandates requiring 14% renewable energy in transport by 2030. North America’s biodiesel demand grows with California’s Low Carbon Fuel Standard. This trend reduces greenhouse gas emissions by 80% compared to fossil fuels, supporting market expansion by aligning with global decarbonization goals and scaling UCO’s role in renewable energy.

Advanced Collection Systems

Efficient collection systems, like IoT-enabled bins, enhance UCO recycling, with 50% of 2023 European collections using smart technology. Olleco’s UK network, collecting 200,000 tons annually, integrates real-time tracking. Asia-Pacific’s urban centers, like Shanghai, adopt similar systems, boosting yields by 15%. These systems optimize logistics, ensuring consistent supply from restaurants and households. This trend supports market growth by improving scalability and reducing costs, making UCO a reliable feedstock for biodiesel and other applications in high-demand regions.

Sustainable Oleochemical Demand

Oleochemicals, derived from UCO for soaps and cosmetics, grow with 20% of 2023 applications. Companies like Croda in Europe use UCO-based glycerin, reducing reliance on virgin oils. Asia-Pacific’s personal care market, led by India, drives demand for sustainable ingredients. This trend aligns with consumer preference for eco-friendly products, with 65% of global brands prioritizing green sourcing in 2023. Oleochemical applications support market growth by diversifying UCO uses, enhancing value in industrial and consumer sectors while promoting sustainability.

Food Waste Reduction Policies

Global food waste policies, like the EU’s Circular Economy Action Plan, boost UCO collection, with 70% of 2023 European supply tied to mandates. Japan’s Food Recycling Law diverts 30% of commercial oil to biodiesel. North America’s EPA encourages restaurant recycling, as seen in Chicago’s 2023 program collecting 500 tons. These policies reduce landfill waste, supporting UCO supply chains. This trend drives market growth by ensuring steady feedstock availability, aligning with sustainability goals, and fostering public-private partnerships in waste management.

Industry Applications

Biodiesel Production

Biodiesel, the primary UCO application, holds 60% market share. In 2023, BP’s German refinery converted 500,000 tons of UCO into biodiesel, powering 10% of local transport. Europe’s 44.3% share reflects robust infrastructure, with 2,000 biodiesel plants. Asia-Pacific’s demand grows with China’s 1 billion liters of UCO-based fuel. Biodiesel cuts emissions by 80%, per the IEA, driving adoption in aviation and shipping. This application supports market growth by meeting renewable energy targets, ensuring UCO’s role in decarbonizing transport and energy sectors.

Oleochemical Manufacturing

Oleochemicals, used in soaps, lubricants, and cosmetics, account for 20% of UCO applications. Darling Ingredients’ U.S. facilities produce 100,000 tons of UCO-based glycerin annually, supplying brands like Unilever. Europe’s sustainable cosmetics market, with 30% growth in 2023, drives demand. Asia-Pacific’s personal care boom, led by India, boosts UCO use. This application supports market growth by diversifying revenue streams, offering eco-friendly alternatives to palm oil, and aligning with consumer demand for sustainable products in industrial and consumer goods.

Animal Feed Production

Animal feed, using 15% of UCO, supports livestock nutrition, particularly in Asia-Pacific. China’s feed industry, processing 50,000 tons of UCO in 2023, enhances poultry diets. North America’s feed mills, like those in Iowa, adopt UCO for cost efficiency. Regulations ensure safety, with 80% of UCO treated to remove contaminants. This application drives market growth by providing a high-energy, low-cost feed ingredient, supporting agricultural sustainability and reducing reliance on virgin oils in regions with large livestock sectors.

Other Industrial Uses

Industrial applications, like lubricants and asphalt additives, use 5% of UCO. In 2023, Europe’s road construction sector, led by Germany, incorporated 20,000 tons of UCO-based binders, improving pavement durability. Asia-Pacific’s manufacturing hubs, like Malaysia, use UCO in bio-lubricants. These niche uses diversify UCO’s value, reducing waste. This application supports market growth by expanding industrial demand, offering sustainable alternatives to petroleum-based products, and aligning with circular economy principles in construction and manufacturing.

Regulatory Landscape

Biofuel Mandates

Biofuel mandates, like the EU’s Renewable Energy Directive II, drive UCO demand, requiring 14% renewable transport fuel by 2030. In 2023, 80% of Europe’s biodiesel used UCO, per Eurostat. Non-compliance led to 2022 fines for 5% of refineries. North America’s Renewable Fuel Standard boosts UCO use, while Asia-Pacific’s policies, like India’s SATAT, emerge. These mandates ensure market growth by incentivizing biodiesel production, securing UCO supply, and supporting decarbonization across transport and aviation sectors.

Waste Management Regulations

Waste management laws, like the EU’s Waste Framework Directive, mandate UCO recycling, with 70% of 2023 European collections tied to compliance. Japan’s 2023 regulations diverted 100,000 tons from landfills. Non-compliance risks fines, as seen in a 2022 UK case against 10% of restaurants. North America’s EPA encourages recycling, boosting supply. These regulations support market growth by ensuring consistent UCO collection, reducing environmental impact, and aligning with circular economy goals in high-consumption regions.

Food Safety Standards

Food safety regulations, like the U.S. FDA’s FSMA and EU’s HACCP, govern UCO processing for feed and oleochemicals. In 2023, 85% of UCO met contaminant limits, per industry audits. A 2022 recall of 5,000 tons of contaminated feed in Asia-Pacific underscored compliance needs. Europe’s stringent standards support 44.3% of supply. Compliance ensures safe applications, supporting market growth by building trust and enabling UCO use in sensitive industries like animal feed and cosmetics.

Challenges in Used Cooking Oil Market

Inconsistent Collection Systems

Inconsistent collection, with only 30% of global UCO recycled in 2023, limits supply. Europe’s 44.3% share benefits from robust systems, but Asia-Pacific’s fragmented networks, like India’s, collect only 20% of potential. A 2022 U.S. shortage delayed 10% of biodiesel production. Scaling IoT-enabled systems, as Olleco did, improves efficiency. Consistent collection supports market growth by ensuring feedstock availability, critical for meeting biodiesel and oleochemical demand in high-consumption regions.

Quality and Contamination Issues

Contamination, like water or food residues, affects 15% of UCO, raising processing costs. North America’s inconsistent household collections, unlike Europe’s commercial focus, increase impurities. A 2023 European refinery reported 5% yield loss due to poor-quality UCO. Advanced filtration, used by Darling Ingredients, mitigates risks. Ensuring quality supports market growth by maintaining product reliability, enabling UCO’s use in biodiesel and feed, and meeting regulatory standards across regions.

Regulatory Compliance Costs

Compliance with biofuel and waste regulations raises costs by 10% annually. Europe’s HACCP certification, impacting 44.3% of supply, burdens smaller collectors. A 2022 fine hit 5% of Asia-Pacific processors for non-compliance. North America’s EPA standards add complexity. Streamlined processes, as Neste adopted, reduce costs. Compliance supports market growth by ensuring market access, but cost management is critical to maintain profitability and scalability in competitive UCO markets.

Competition for Feedstock

Competition from illegal UCO exports, with 10% of 2023 supply diverted to unregulated markets, challenges availability. Asia-Pacific’s growing biodiesel demand faces supply leaks, as seen in a 2022 China crackdown. Europe’s regulated systems mitigate risks. Strengthening enforcement, like the EU’s tracking, ensures supply. Addressing competition supports market growth by securing feedstock for legitimate applications, ensuring UCO meets rising demand in biodiesel and industrial sectors.

Future Opportunities

Biofuel Market Expansion

Biofuel demand, projected to grow 20% by 2030, offers potential. Neste’s 2023 expansion in Rotterdam, processing 2 million tons of UCO, targets aviation fuel. Europe’s 44.3% share drives growth, while Asia-Pacific’s policies, like India’s, emerge. Scaling UCO-based biodiesel, as BP did, captures demand. This opportunity supports market expansion by meeting renewable energy goals, ensuring UCO’s role in decarbonizing transport and aviation through 2033.

Emerging Market Growth

Emerging markets, like Africa and Southeast Asia, offer potential, with UCO collection rising 15% annually. Nigeria’s 2023 program collected 10,000 tons, while Malaysia’s biodiesel sector grows. Asia-Pacific’s expertise supports technology transfer. Cost-effective systems, like Singapore’s Greasecycle, drive adoption. Capturing these markets supports market growth by expanding collection networks, meeting biofuel demand, and aligning with sustainability goals in developing regions.

Oleochemical Innovation

Oleochemical applications, like bio-lubricants, offer growth, with 20% of 2023 R&D focused on UCO-based products. Croda’s 2023 UCO-derived surfactants, used in Europe’s cosmetics, cut emissions by 15%. Asia-Pacific’s personal care boom drives demand. Scaling sustainable oleochemicals supports market growth by diversifying UCO uses, offering eco-friendly alternatives, and meeting consumer demand for green products in industrial and consumer sectors.

Circular Economy Integration

Circular economy initiatives, like the EU’s 2030 waste reduction goals, offer potential. Japan’s 2023 recycling program diverted 50,000 tons of UCO, boosting supply. North America’s city-level programs, like Chicago’s, grow. Public-private partnerships, as Olleco’s UK model shows, enhance collection. Integrating UCO into circular systems supports market growth by ensuring feedstock availability, reducing waste, and aligning with global sustainability priorities through 2033.

Conclusion

The used cooking oil market is thriving as a sustainable resource, powered by demand for biodiesel, improved collection, and circular economy policies. There are challenges, such as irregular collection, contamination, and competition, but the potential in biofuels, new markets, and oleochemicals is significant. UCO is an effective waste, and by utilizing technology, regulatory support, and novel applications, waste can be converted into valuable resources. As global priorities are always shifting to sustainability and renewable energy, the UCO market will be key to future growth and will have a significant environmental impact, by 2033 and beyond.