Used Cooking Oil Market Expected to Reach $11.8 Billion by 2034

According to a new report published by Allied Market Research, titled, “used cooking oil market" was valued at $6.4 billion in 2023, and is projected to reach $11.8 billion by 2034, growing at a CAGR of 5.8% from 2024 to 2034.

Used cooking oil refers to vegetable oils and animal fats that have been previously used in cooking or frying foods. Once used, these oils undergo chemical changes and may contain impurities such as food particles, water, and free fatty acids. Used cooking oil holds significant value as a feedstock for producing biodiesel, a renewable and environmentally friendly fuel. It is also utilized in the production of soap, cosmetics, and animal feed. Proper collection and processing of used cooking oil are essential to ensure its quality and suitability for these applications. Recycling used cooking oil helps reduce waste, decrease environmental pollution, and contribute to the circular economy by transforming a waste product into valuable resources.

The global used cooking oil industry has experienced significant growth driven primarily by the rise in demand for biodiesel production. As countries around the world intensify their efforts to reduce carbon emissions and seek sustainable energy alternatives, biodiesel has become an attractive option. Used cooking oil is a cost-effective and readily available feedstock for biodiesel production, making it an integral part of the shift toward renewable energy. Government regulations and incentives promoting the use of renewable energy sources further support the trend, which encourages businesses to adopt environmentally friendly practices. The growing awareness of the environmental benefits of converting used cooking oil into biodiesel, such as reducing greenhouse gas emissions and decreasing dependency on non-renewable resources, has fueled the used cooking oil market size.

However, the market faces significant restraints, particularly concerning the collection and processing of used cooking oil. Collecting used oil from diverse sources such as households, restaurants, and food processing units poses a logistical challenge. The process is resource-intensive and requires stringent measures to ensure the oil collected is free from contaminants, which can affect the quality of biodiesel. In addition, the infrastructure for efficient collection, storage, and processing of used cooking oil is often limited, especially in developing regions. These limitations increase operational costs and create substantial barriers for new entrants and small-scale producers, which hinders the used cooking oil market growth of the market.

However, the global used cooking oil market also presents substantial growth opportunities, especially through technological advancements and innovations in collection and processing methods. Emerging technologies that enhance the efficiency and effectiveness of collecting and converting used cooking oil can mitigate many existing challenges. Innovations in filtration and purification technologies can improve the quality of the collected oil, making it more suitable for biodiesel production. Moreover, the development of mobile collection units and smart systems can streamline the collection process, reducing costs and enhancing operational efficiency. The growing emphasis on circular economy principles and sustainable practices across various industries opens new opportunities for using used cooking oil. Other than biodiesel, used cooking oil can be utilized in producing animal feed, oleochemicals, and even as a raw material in the cosmetic industry. These advancements and the expanding range of applications highlight the potential for significant growth in the global used cooking oil market in the coming years.

The global used cooking oil market forecast is segmented on the basis of source, application, and region. By source, it is classified into the household sector and the commercial sector. By application, it is divided into biodiesel, oleo chemicals, animal feed, and others. Region wise, the market is analyzed across North America, Europe, Asia-Pacific, and LAMEA.

Based on the source, the cocoa beans segment held the highest market share in 2023. The rise in the number of food & service industries and hotels results in huge production of used cooking oil globally, which is collected in bulk quantity by the suppliers. In addition, the efforts taken by the used cooking oil suppliers for making an organized collection of used cooking oil along with providing containers to the restaurants for collecting used cooking oil contribute toward the growth of the used cooking oil market opportunities.

Based on the application, the Oleo chemicals segment held the highest market share in 2023. Used cooking oil has a wide application in the bakery and confectionery industry due to their versatility, flavor, and texture. The dominance of this segment is due to the rise in demand for sustainable and renewable resources in the chemical industry. This trend has encouraged the Oleo chemical industry to focus on alternative and renewable raw materials such as used cooking oil to produce products including soap. Moreover, used cooking oil is a waste material that does not compete with edible vegetable oil & fats and is available at a low cost in the market. The fact leads to the increase in applications of used cooking oil in oleo chemicals. This in turn is anticipated to fuel the growth of the used cooking oil market trends in the future.

Based on region, Europe held the highest market share in terms of revenue in 2023. The European Union's Renewable Energy Directive promotes the use of renewable fuels, including biodiesel made from used cooking oil, incentivizing its collection and recycling. The strong focus on sustainability and circular economy principles in Europe further encourages the repurposing of waste materials such as used cooking oil into valuable resources. The region benefits from a well-developed infrastructure for collecting and processing used cooking oil, facilitating biodiesel production. Moreover, using waste oils reduces reliance on food crops for biofuels, addressing concerns about food security and land use. Europe's high population density enhances the efficiency of collection efforts, while public awareness and environmental consciousness contribute to increased participation in recycling programs for used cooking oil.

The major players operating in the used cooking oil market include Valley Proteins, Inc., Quatra, Baker Commodities Inc., Arrow Oils Ltd, Olleco, Waste Oil Recyclers, Grand Natural Inc., GREASECYCLE, Brocklesby Limited, and Oz Oils Pty Ltd.

Key Findings of the Study

• By source, the commercial sector segment accounted for the highest used cooking oil market share in 2023.
• By application, the biodiesel segment occupied the maximum share in the used cooking oil market analysis in 2023.
• By region, Europe accounted for a major share in 2023 of the used cooking oil market.