Rising Demand for Used Cooking Oil in the EU and US Leads to Supply Shortage

The increase in Europe’s Used Cooking Oil (UCO) Demand has resulted in a heavy reliance on imports According to Transport and Environment (T&E) reports. Daily, Europe is burning around 130.000 barrels of used cooking oil. This amount is as much as 8 times more than the UCO amount collected in Europe. Adding to the matter, Airlines, and aviation are starting to implement sustainability regulations with sustainable aviation fuel (SAF). To fill the gap between the high demand and limited supply, Europe is importing more and more UCO from China and South East Asia countries such as Indonesia and Malaysia.

Europe UCO Supply Struggle to Fulfill the Increasing Demand

Based on Stratas’ analysis, the European Union consumed nearly seven million tonnes of UCO for biofuels in 2023, with the majority being blended for use in cars and trucks. This is almost eight times higher than the estimated collected volumes in 2023 and four times the maximum potential of the continent, with demand growing much faster than domestic supply.

European UCO appears to come almost exclusively from restaurants, The UCO collection from households in Europe only counted less than 10%, and more than half of the maximum collection potential of the continent is already tapped.

Because of this limited collection potential, the combined UCO and SAF demand will stay short of supply if they only rely on this domestic source.

Also Read : Indonesia Launches Its First Red Cooking Oil Facility

Sign of Fraud

With the US Biden’s Inflation Reduction Act (IRA), The United States used cooking oi demand (UCO) also experienced an increase. The IRA, which incentivises the more environmentally friendly fuels has created a new big market, increasing demand.  The increased demand in the US and Europe which resulted in increasing export of UCO by countries such as China, Indonesia, and Malaysia raises serious suspicion. China waste-based biodiesel export has increased significantly by 40%.

In 2023 alone, China, Indonesia, and Malaysia have increased their waste cooking oil collection to around 4 million tonnes. But as mentioned before, the collection and export number irregularities raise suspicion of the mislabelled virgin cooking oil as waste cooking oil. Malaysia for example, has recorded exporting three times more UCO than they were collected.