Yellow Grease: How Used Cooking Oil Became a Fuel, a Commodity and a Target for Thieves

Behind almost every restaurant that fries food there is a container of dark, used oil waiting to be picked up. Most diners never think about it. But that oil, known in the trade as yellow grease, is a traded commodity with its own price reports, quality specifications, import statistics and crime problem. It feeds livestock, goes into soaps and industrial chemicals, and in the past fifteen years has become one of the most important raw materials for biodiesel and renewable diesel in the United States and Europe.

The value of this "waste" has grown so much that federal prosecutors have broken up multistate theft rings, an industry association estimates hundreds of millions of dollars' worth is stolen every year, and governments on both sides of the Atlantic have opened investigations into whether some imported "used" cooking oil was ever used at all.

This article explains what yellow grease is, how it differs from brown grease, how it is collected and processed, what it is used for, how biofuel policy transformed its market, what it costs, why it gets stolen, and what its environmental benefits and limits really are.

What is yellow grease?

A working definition

Yellow grease is the trade name for used cooking oil and fat recovered from commercial kitchens and food processors, most commonly from deep fryers. The same material is called used cooking oil (UCO) or waste vegetable oil (WVO), especially in Europe and in biofuel policy documents. In the US Energy Information Administration's biofuel statistics, the yellow grease category explicitly "includes used cooking oil."

Most yellow grease today is vegetable oil: soybean, canola, palm, corn or other frying oils. Some contains animal fats, depending on what restaurants cook with and what was fried. The material is a mixture, and its composition varies by region, season and type of kitchen.

An older meaning

The term is older than the modern restaurant trade. Wikipedia's article on rendering notes that since at least 1896, "yellow grease" has been used for lower-quality grades of tallow, meaning cow or sheep fat, from rendering plants. Over the 20th century, as restaurant frying increased and restaurant grease became a major input for renderers, the term shifted to its current, mainly culinary, meaning.

Quality specifications

As a traded commodity, yellow grease is bought and sold against a specification. Price reporting agencies that assess US yellow grease use limits such as the following:

These figures appear in yellow grease price assessments published by Fastmarkets and QCIntel, and follow trade conventions derived from the American Fats and Oils Association. A 2009 buyer's guide published in Render magazine lists the same MIU and colour limits.

What these numbers mean:

• Free fatty acids. Fresh cooking oil is made mostly of triglycerides, molecules built from three fatty acids attached to a glycerol backbone. Repeated heating, moisture from food and contact with air break some of those fatty acids off. The more an oil has been used and abused, the higher its free fatty acid content. FFA matters because it affects how easily the oil can be turned into biodiesel and how suitable it is for feed.
• MIU. This is everything that is not useful fat: water, bits of food, dirt and compounds that cannot be turned into soap. Buyers want as little as possible.
• Colour. The FAC scale is a standard way of grading the colour of fats. Darker oil usually indicates heavier use or contamination.

Yellow grease versus brown grease

The most important distinction in this business is between yellow and brown grease.

Brown grease comes from grease interceptors, devices installed in restaurant drain lines to catch fats, oils and grease before they reach the sewer. A 2002 National Renewable Energy Laboratory paper by Tyson, cited by Wikipedia, makes this basic distinction: yellow grease is typically frying oil from deep fryers, brown grease comes from grease interceptors.

Definitions of the boundary vary. Patent filings and industry sources use thresholds of 15 percent or 20 percent free fatty acids, and trap grease can be extremely high in free fatty acids because it has sat in warm, wet conditions where it breaks down. Brown grease is harder and more expensive to process, which is why it is worth far less, and why much of it has historically gone to landfill or to wastewater treatment plants.

How much is there?

A per-person picture

A frequently cited reference point is the Urban Waste Grease Resource Assessment, prepared for the National Renewable Energy Laboratory by G. Wiltsee and published in 1998 and 1999 (report NREL/SR-570-26141). The study collected data from 30 randomly selected US metropolitan areas on two categories: yellow grease collected from restaurants by rendering companies, and grease trap waste. Secondary sources citing the study commonly give figures of roughly 9 pounds of yellow grease and roughly 13 to 14 pounds of trap grease generated per person per year. These numbers are now more than a quarter of a century old and are best treated as rough orders of magnitude, since restaurant habits, frying oils and collection practices have changed.

What official statistics show, and hide

The US Department of Agriculture's National Agricultural Statistics Service publishes an annual summary of fats and oils production. In its 2024 summary, released in March 2025, NASS reported 1.25 billion pounds of choice white grease and 3.88 billion pounds of inedible tallow. For yellow grease, however, every production figure is marked "(D)," meaning "withheld to avoid disclosing data for individual operations." In other words, the survey's yellow grease numbers are concentrated in so few reporting companies that publishing them would reveal individual businesses' data.

That detail says something about the industry. Wikipedia notes that the collection and rendering industry is dominated by a number of very large companies, alongside a long tail of small and mid-sized collectors for which no reliable statistics exist.

How much goes into biofuels

The best public data on how yellow grease is used come from the EIA, which surveys biofuel producers. Its Monthly Biofuels Capacity and Feedstocks Update reported the following US consumption of yellow grease for biofuel production (figures in million pounds; annual totals are sums of EIA's monthly figures):

Two points stand out. First, yellow grease is now a major biofuel feedstock, used at more than half the volume of soybean oil in 2024. Second, its use fell markedly in 2025. The American Soybean Association had predicted that changes in federal tax credits from 2025, discussed below, would make imported feedstocks less attractive, and the EIA data are consistent with a sharp drop in yellow grease use that year. (EIA has since stopped publishing this monthly report as a standalone product and moved the data to its petroleum data pages.)

The longer trend is even more striking. Researchers at the University of Illinois and the USDA Economic Research Service, writing in the farmdoc daily series in January 2024, estimated that yellow grease's share of US biomass-based diesel feedstock rose from 6.0 percent in 2011 to 21.5 percent in 2022, the largest gain of any feedstock. Its use in renewable diesel alone went from under 100 million pounds in 2015 to more than 4 billion pounds in 2022.

A short history

Rendering before biodiesel

People have been rendering fat for centuries. Wikipedia's article on rendering describes the original method as boiling animal fat in open kettles over a fire, mainly to make soap and candles. In the 19th century, steam digesters came into use, and by the end of the Second World War most plants had switched to a dry rendering process.

The big shift in demand came after the war. Synthetic detergents replaced much of the soap market, and in the early 1950s more than half of the market for inedible fats disappeared. Animal feed stepped in and became the single largest use of inedible fats. Adding fat to livestock and poultry rations increases their energy content, and rendered fats and greases, including restaurant grease, became standard feed ingredients.

Wikipedia records that the US rendering industry annually recycles more than 21 million metric tons of perishable organic material. In 2004, it produced over 8 million metric tons of products, of which 1.6 million metric tons were exported.

The restaurant grease business

As fast food and commercial frying expanded in the second half of the 20th century, restaurant grease became a dependable stream of raw material for renderers. Collectors placed tanks or drums behind restaurants, emptied them on a schedule, and took the oil to rendering plants, where it was cleaned and sold mostly into feed and industrial markets.

For much of this period, yellow grease was a low-value product. Restaurants were sometimes paid a little for their oil, and sometimes paid to have it removed, depending on prices. Writing for the EIA in 2004, analyst Anthony Radich estimated that less than a third of yellow grease could be spared for biodiesel production each year, because most of it was already committed to other uses.

Biofuels change everything

Biodiesel had been made from vegetable oils for decades, but large-scale commercial production in the United States took off in the 2000s, helped by tax credits and by the Renewable Fuel Standard, first enacted in 2005 and expanded in 2007. Used cooking oil was attractive as a feedstock because it was cheaper than fresh vegetable oil and, being a waste, had a much lower carbon footprint under the accounting rules used by regulators.

Demand accelerated sharply in the late 2010s and early 2020s with the rise of renewable diesel, a different and more flexible fuel described below. Low-carbon fuel policies, above all California's Low Carbon Fuel Standard, rewarded feedstocks with low carbon intensity scores. Yellow grease scored well, and its value rose accordingly.

By 2019, CBS News reported that yellow grease production for biodiesel had risen about 13 percent in 2018 to 1.67 billion pounds, up from about 1.4 billion pounds in 2017. Within five years the EIA was recording more than 7 billion pounds a year going into biofuels.

How yellow grease is collected and processed

At the restaurant

The typical arrangement is simple. A collector provides a container: an outdoor tank, a bin or, increasingly, an indoor tank connected to the fryers by pipes. Kitchen staff drain spent oil into it. When it fills, or on a fixed schedule, a truck pumps it out. In some contracts the restaurant receives a payment per gallon or a share of the value; in others, collection is provided as a free service or for a fee, depending on volume and market prices.

Wikipedia notes that automated collection and storage systems, in which oil is pumped directly from fryers to a sealed tank, have been "rising dramatically." These systems reduce spills and burns for staff, and also make theft harder, since the oil is not sitting in an open drum behind the building.

At the plant

Rendering, in the context of yellow grease, means separating the useful fat from water, food solids and other impurities. The main steps are typically:

1. Heating the oil so it flows easily and so water and solids separate more readily.
2. Settling or centrifuging to remove water and heavier solids.
3. Filtering out remaining particles.
4. Drying to reduce residual moisture.

The result is a cleaned oil that meets a specification such as the one shown earlier. Some collectors render their own grease. Others sell raw oil at a lower price to firms that have the space and equipment to process it.

Regulation of collectors

Because yellow grease is a waste, its handling is regulated. In the United Kingdom, according to Wikipedia, collection is governed by the Environment Agency: collectors must be registered waste carriers, and both the restaurant and the collector must keep waste transfer notes for at least three years.

In the United States, rules vary by state. California, which has one of the most developed programmes, regulates what it calls inedible kitchen grease (IKG) through the California Department of Food and Agriculture's rendering programme, which was set up in 1995 in response to increasing theft. Under the programme, as described in CDFA's own FAQ:

It is unlawful in California to transport inedible kitchen grease without registration. Licensed renderers, collection centres and registered transporters may not accept grease from an unregistered transporter, and no one may knowingly take possession of stolen grease. CDFA's FAQ lists 47 licensed renderers, 57 collection centres and 318 registered transporters.

What yellow grease is used for

Animal feed

Feed was the dominant market for yellow grease for decades. Fat is a dense energy source, and adding it to rations for cattle, pigs and poultry improves energy content and can reduce dust in feed. Wikipedia cites a plant lipids textbook (Murphy, 2005) listing livestock feed among the main uses of yellow grease.

Oleochemicals and consumer products

The same source lists soap, cosmetics, clothing, rubber and detergents among products that use yellow grease. In these industries, fats are broken down into fatty acids and glycerol, which are then used as chemical building blocks. Fatty acids go into surfactants, lubricants, plastics additives and many other products.

Biodiesel

Biodiesel, technically fatty acid methyl ester (FAME), is made by reacting fats or oils with methanol in a process called transesterification. The triglycerides in the oil are converted into methyl esters, which make the fuel, and glycerin, a by-product.

Yellow grease is a good biodiesel feedstock in many ways, but its free fatty acids are a complication. Conventional biodiesel production uses an alkaline catalyst. Free fatty acids react with that catalyst to form soap instead of fuel, which reduces yield and makes separation harder. Producers handling yellow grease therefore often use a pre-treatment step, such as an acid-catalysed reaction that converts free fatty acids into esters, before the main process. The higher the free fatty acid content, the more expensive this becomes, which is one reason brown grease is so much harder to use than yellow grease.

Renewable diesel

Renewable diesel, sometimes called hydrotreated vegetable oil (HVO), is made by a different route. Wikipedia describes it as being produced by hydrodeoxygenation: the oil is reacted with hydrogen at high temperature and pressure over a catalyst, which strips out oxygen and produces hydrocarbons that are chemically very similar to petroleum diesel.

This has two big advantages. The resulting fuel can be used in ordinary diesel engines and pipelines without blending limits, unlike biodiesel, which is usually blended with petroleum diesel. And the process is generally more tolerant of the free fatty acids and impurities found in waste fats. As renewable diesel capacity expanded rapidly in the United States from around 2020, it created a large new source of demand for yellow grease. The farmdoc daily researchers note that more than 80 percent of US-produced renewable diesel is consumed in California.

Sustainable aviation fuel

The same hydroprocessing route can produce jet fuel. DTN reported in August 2024 that federal sustainable aviation fuel guidelines released in late April 2024 made used cooking oil especially popular, because it has one of the lowest carbon scores among eligible feedstocks.

Anaerobic digestion

Lower-quality greases, especially brown grease, can be fed to anaerobic digesters, where microbes break them down to produce biogas, mostly methane, which can be burned for heat and power. Reviews of trap waste management identify co-digestion with other wastes as one of the main future uses for this material.

Why policy made yellow grease valuable

Carbon intensity

Low-carbon fuel policies do not just require a certain amount of biofuel. Many of them reward fuels according to how much they reduce greenhouse gas emissions compared with fossil fuels, measured as carbon intensity in grams of carbon dioxide equivalent per megajoule of energy (gCO2e/MJ).

Under California's Low Carbon Fuel Standard, which took effect in 2011 and is administered by the California Air Resources Board, each fuel pathway receives a carbon intensity score. An EIA analysis published in November 2018 gave the carbon intensity of the ultra-low sulfur diesel that makes up most of California's diesel supply as 102 gCO2e/MJ, and reported that renewable diesel supplied to California had averaged about 30 gCO2e/MJ since spring 2016, with much of it made from used cooking oil. Fuels made from waste fats tend to score well because they are not charged with the emissions of growing a crop, nor with the indirect land use change effects assigned to crop-based oils.

The lower a fuel's carbon intensity, the more credits it earns per gallon. That turns a good carbon score directly into money. The American Soybean Association, which has an interest in the comparison, wrote in 2024 that UCO often sold at a premium over palm oil in the US Gulf, at times over 50 percent, because of LCFS credits, though it noted the premium had recently disappeared as credit values fell. Bloomberg, in a report republished by Transport Topics in May 2024, said used cooking oil was priced about a third cheaper than refined soybean oil.

Federal programmes

At the federal level, the Renewable Fuel Standard sets annual volumes of biofuel that must be blended into US transport fuel, with tradable credits called RINs. Biomass-based diesel made from waste fats qualifies. Federal tax credits added another layer of support. According to the American Soybean Association, the long-standing blenders' tax credit ended in 2025 and was replaced by a clean fuel production credit known as 45Z, under which imported biomass-based diesel is not eligible. In June 2024, several major farm groups wrote to the Treasury asking for a domestic-feedstock requirement for 45Z, arguing that the benefits were at risk of being diverted from American farmers.

Europe

In the European Union, used cooking oil is listed in Annex IX Part B of the Renewable Energy Directive, a category of waste-based feedstocks whose contribution towards transport targets is capped at 1.7 percent but which can count more heavily than crop-based fuels. Member states apply these rules differently, and some exceed the cap. Double counting and the high value of waste-based feedstocks have repeatedly raised concerns about fraud, discussed below.

The import boom and the authenticity question

A surge from China

As demand for low-carbon feedstocks outstripped domestic supply, the United States started importing large amounts of used cooking oil. According to US International Trade Commission data cited by Bloomberg, US UCO imports more than tripled in 2023 to about 1.4 million metric tons, or 3.1 billion pounds. More than half came from China. The American Soybean Association calculated that UCO imports had risen from under 300 million pounds in 2021 to over 3 billion pounds in 2023, that the US took about 40 percent of China's UCO exports in 2023, and that more than 90 percent of 2023 UCO imports came in through the Gulf Coast.

Reuters reported in October 2023 that Chinese UCO exports to the US had begun in October 2022, two months after the Inflation Reduction Act was passed, and were worth almost $390 million over the following twelve months.

Is it really used?

Because used cooking oil earns far more credit than virgin vegetable oil, there is an obvious incentive to pass off fresh oil as used. Bloomberg's 2024 report quoted Geoff Cooper, chief executive of the Renewable Fuels Association, saying: "It appears to be one of the worst kept secrets out there that this is happening," and warning that the surge "could potentially undermine the integrity of the Renewable Fuel Standard." Todd Becker, chief executive of Green Plains, said: "Somebody's got to figure out that that's not all Chinese used cooking oil."

The specific worry, reported by both Bloomberg and DTN, was that fresh palm oil, which is associated with deforestation and has a much higher carbon footprint, was being blended into supposedly used oil. No US government finding of such fraud was reported in those articles, but the concern was serious enough to prompt action:

• In June 2023, Germany asked the European Commission to investigate Chinese biofuel imports labelled as made from waste oils, according to the American Soybean Association, citing Reuters.
• EU imports of Chinese UCO fell by almost 600,000 metric tons in 2023 compared with 2022, while US imports rose by more than 700,000 metric tons.
• In June 2024, US Senator Roger Marshall led a letter to the EPA, USDA, Customs and Border Protection and the US Trade Representative raising concerns about UCO imports from China.
• In July 2024, according to DTN, the European Commission announced anti-dumping tariffs of 36 percent on biodiesel imports from China.
• In August 2024, DTN reported that the EPA had been auditing biofuel companies on where they sourced waste cooking oil. An EPA spokesperson, Jeff Landis, described the audits as routine and said the agency "investigates, where appropriate," whether feedstocks qualify under the Renewable Fuel Standard.

The American Soybean Association pointed out a structural weakness: the EPA requires chain-of-custody records for all UCO but does not audit them until an enforcement action begins, which happens after the credits have already been generated.

Why this matters for the whole industry

For legitimate collectors and renderers, fraud is a double threat. It undercuts their prices with cheaper material, and it damages the credibility of the waste-based fuels they sell. If regulators lose confidence in the "used" label, the special treatment that makes yellow grease valuable could be cut back.

Prices

What the market pays

Yellow grease prices move with the markets for vegetable oils, animal fats, diesel and biofuel credits. Some reported examples:

The USDA figures come from its National Animal By-Product Feedstuff Report and describe one region with relatively thin trading, so they are not national averages. They illustrate the order of magnitude: in this period, yellow grease was trading for roughly a third of a dollar to over 40 cents per pound in the markets reported.

From pounds to gallons

Restaurants and thieves usually think in gallons rather than pounds. A gallon of cooking oil weighs a little under 8 pounds, so a price of 35 cents per pound for rendered, specification-grade grease corresponds to roughly $2.50 to $3 per gallon of finished product. Raw oil straight from a restaurant is worth considerably less, because it contains water and solids and still has to be collected and processed. Press reports on theft cases have cited thieves being paid around 25 cents per gallon, and one 2019 report cited a range of 25 to 60 cents per gallon paid by third-party buyers.

A hypothetical restaurant

The following is a hypothetical illustration, not data from any real business. Imagine a busy fried-chicken restaurant that generates 100 gallons of used oil a week. At a payment of 50 cents per gallon, its oil is worth $50 a week, or about $2,600 a year. That is not a fortune, but for a small business it is meaningful, and for a thief who empties ten such tanks a night the numbers add up quickly.

Grease theft

The scale of the problem

As the value of yellow grease rose, so did theft. For years, news reports repeated an estimate that the industry lost $45 million to $75 million a year to grease theft. That figure appeared, for example, in a 2019 statement by the US Attorney for the Eastern District of North Carolina, and in a 2019 CBS News report that attributed a figure of up to $75 million to the National Renderers Association.

In October 2025, the North American Renderers Association (the successor name of the National Renderers Association) published a much higher estimate: $300 million to $500 million a year, described as conservative and pending the results of an ongoing industry study. NARA said the older figure originated in a 1980 industry survey and did not reflect current volumes or prices. NARA chief executive Kent Swisher, commenting after a later federal indictment, said: "These indictments reinforce the need for better preventive measures."

Earlier estimates were far lower still. In 2011, the then-president of the National Renderers Association, Tom Cook, estimated that about 6 million pounds of raw material was being stolen across North America each year, while acknowledging there was no precise count. The very wide range of estimates over time reflects both rising prices and the basic difficulty of measuring a crime that often goes unreported.

How it works

Grease theft is usually low-tech. Thieves arrive at night with a truck or van fitted with a tank and pump, open a restaurant's outdoor grease container, and siphon out the oil. The restaurant may not notice until its contracted collector arrives to find an empty tank. Stolen oil is then sold to buyers who are willing not to ask questions, sometimes passing through several hands before reaching a processor.

Notable cases

• North Carolina, Tennessee and Virginia, 2019. In June 2019, federal prosecutors in Raleigh unsealed an indictment against 21 people accused of stealing $3.9 million worth of used cooking oil from restaurants over five years. According to the Associated Press, the thieves drew oil from restaurant storage tanks and shipped it across the country. The charges included conspiracy and money laundering, carrying sentences of up to 25 years. The AP described the oil as "greasy gold for biodiesel companies," and a statement from US Attorney Robert Higdon Jr. put the rendering industry's annual losses to oil theft at $45 million to $75 million.
• Fairfax County, Virginia, 2019. CBS News, drawing on Washington Post reporting, described a man arrested for pumping hundreds of gallons of used grease from a container outside a Burger King. He told police he was usually paid 25 cents a gallon and made $300 to $400 a trip. Fairfax police had recorded six yellow grease thefts in the previous year and suspected many more went unreported.
• Iowa and other states, 2025. In December 2025, Agri-Pulse reported that a federal grand jury in Iowa had returned a nine-count indictment charging several Chinese nationals with theft and resale of restaurant cooking oil across several states, including Iowa and Tennessee.

Many smaller cases appear regularly in local news across the United States, involving arrests in Florida, Maryland, New York, Connecticut and elsewhere.

Prevention

Industry groups and collectors recommend several steps:

• Locked or tamper-resistant containers, and indoor tanks connected directly to fryers.
• Checking the credentials of anyone who arrives to collect oil. NARA has specifically urged restaurants to verify collectors and urged renderers and traders to improve tracking and documentation.
• Reporting thefts to police and, where they exist, state programmes. California's CDFA, for example, takes confidential theft reports.
• Tighter rules for transporters, such as registration and vehicle identification, which make it harder for stolen oil to enter legitimate channels.

California has gone furthest. Under its rendering programme, a first criminal violation can bring up to a year in county jail and a fine of up to $5,000. A second violation, or one committed with intent to defraud, can bring a state prison term and a fine of up to $15,000. A 2014 state law, according to legislative analyses, also allowed peace officers to impound a transporter's vehicle for up to 15 days when it is involved in grease theft.

Environmental impact

The benefits

Recycling used cooking oil has several clear environmental benefits.

• Keeping it out of sewers. Oil poured down drains cools and congeals in pipes, combining with other debris to cause blockages. Grease is a leading cause of sewer blockages in the United States; municipal summaries of an August 2004 EPA report to Congress on sewer overflows commonly cite grease as responsible for nearly half of sanitary sewer overflows. Those overflows send raw sewage into streets, basements and waterways. Collecting yellow grease removes a major source of the problem.
• Fatbergs. In extreme cases, grease combines with wet wipes and other waste to form "fatbergs." In 2017, Thames Water found a mass weighing about 130 tonnes and stretching about 250 metres in a sewer under Whitechapel in east London. The company worked with Argent Energy to convert part of it into biodiesel, with a projected yield of about 10,000 litres.
• Lower-carbon fuel. Because fuels made from used cooking oil are not charged with the emissions of growing a crop, regulators assign them some of the lowest carbon intensity scores of any liquid fuels. EIA reported an average of about 30 gCO2e/MJ for renewable diesel in California from 2016 against 102 for conventional diesel.
• Resource efficiency. Using a waste stream for fuel, feed or chemicals means less demand for fresh oils and fats.

The limits

The picture is not as simple as "waste becomes fuel."

• Supply is finite. The amount of used cooking oil a country produces depends on how much its people fry. It cannot be increased to meet fuel demand. As biofuel policy pushed demand far above domestic supply, the US turned to imports, which brought the authenticity problems described above.
• Displacement. Yellow grease was not truly unused before biofuels. It went into animal feed and oleochemicals. When it is diverted to fuel, those industries need to replace it, often with other fats or vegetable oils. Critics argue that this indirect effect should be counted when judging the climate benefit, although how to do so is debated.
• Fraud undermines the benefit. If fresh palm or soybean oil is blended into "used" oil, the real carbon savings are much lower than the accounting suggests, and in the case of palm oil may be linked to deforestation.
• Transport. Imported UCO travels long distances by ship, adding emissions, although these are usually small compared with the emissions of the fuel it replaces.
• Brown grease remains a problem. Much of the fat in grease traps is still difficult and costly to recover, and some still ends up in landfill.

Economics and industry structure

Who is involved

The yellow grease supply chain has several layers:

1. Generators: restaurants, institutional kitchens and food processors.
2. Collectors: from large national rendering companies to small local operators. Large renderers such as Darling Ingredients, through its DAR PRO business, operate restaurant collection services, while many smaller firms also compete for accounts.
3. Processors and renderers: who clean the oil to specification.
4. Traders: who buy and sell processed yellow grease domestically and internationally.
5. End users: feed manufacturers, oleochemical producers, biodiesel plants and renewable diesel refineries.

Wikipedia notes that estimates of small and mid-sized collectors in the US run to a couple of hundred, and that many may remain unregistered.

Market size

Commercial research firms produce estimates of the global used cooking oil market. One such estimate, from Fortune Business Insights and cited by Wikipedia, valued the market at $5.16 billion in 2020 and projected growth to $10.08 billion by 2028. Estimates of this kind vary widely between firms and should be treated as indicative rather than precise.

Volatility

Because so much of yellow grease's value comes from biofuel policy, its price can swing sharply when policies change. Credit prices under California's LCFS, the level of federal biofuel mandates, tax credit rules and trade measures all feed into what a renderer will pay for a tank of restaurant oil. The 2025 drop in yellow grease use for biofuels in EIA data, following changes to federal tax credits, is an example of how quickly policy can reshape the market.

Common misconceptions

"Used cooking oil is worthless waste."

It has long had value as a feed and chemical ingredient, and in recent years its biofuel value has made it a commodity worth tens of cents per pound. Restaurants often receive payment for it.

"You can just pour it into your diesel car."

Some enthusiasts have run modified diesel vehicles on filtered vegetable oil, but raw used cooking oil is much thicker than diesel and contains water, food particles and free fatty acids. It can damage unmodified engines and fuel systems. Commercial biodiesel and renewable diesel are made by chemical processing precisely to turn the oil into a fuel that meets engine standards. Using unprocessed oil as road fuel may also raise tax and legal issues in some places.

"Yellow grease and brown grease are the same thing."

They are both waste fats from kitchens, but they are collected differently, have different quality, and go to different uses. Yellow grease comes straight from fryers and is relatively clean. Brown grease comes from grease traps and is wet, dirty and high in free fatty acids.

"Biodiesel and renewable diesel are the same fuel."

Both can be made from yellow grease, but they are different products. Biodiesel is a methyl ester produced by transesterification and is usually blended with petroleum diesel. Renewable diesel is a hydrocarbon produced by hydroprocessing, chemically similar to petroleum diesel, and can be used without blending limits.

"Grease theft is a minor nuisance."

At the scale of individual restaurants, it may seem small. But industry estimates now put annual losses in the US at hundreds of millions of dollars, and federal prosecutors have pursued multistate theft rings under conspiracy and money laundering charges.

"All imported used cooking oil is fraudulent."

There is no public evidence that this is true. Concerns focus on whether some imports include fresh oil, and authorities have responded with audits and investigations. Much international trade in UCO is presumably legitimate, but verification has been weak.

Frequently asked questions

Why is it called "yellow" grease?

The term originally referred to lower grades of rendered tallow, used since at least 1896, and was later applied to used cooking oil. Processed used frying oil typically has a yellow to amber colour, which distinguishes it from the darker brown grease recovered from grease traps.

What should a restaurant do with used cooking oil?

Store it in a container supplied by a licensed or registered collector, keep it secure, and never pour it down drains. Many jurisdictions require restaurants to use grease interceptors and to keep records of grease disposal.

Can households recycle cooking oil?

Many municipalities and some retailers run drop-off points for household cooking oil. Where none exist, local authorities generally advise letting the oil cool and disposing of it in household waste rather than pouring it down the drain.

How much yellow grease does the US use for biofuels?

According to EIA data, about 7.4 billion pounds in 2024 and about 3.9 billion pounds in the first nine months of 2025.

What is yellow grease worth?

Recent USDA reports for one California region put it at roughly 33 to 39 cents per pound in 2025. Prices vary by region, quality and time.

Is grease theft illegal?

Yes. It is theft, and in states such as California it is also specifically covered by laws governing the transport and sale of inedible kitchen grease, with fines and possible jail or prison time.

Why did the US import so much used cooking oil?

Low-carbon fuel policies created demand for low-carbon-intensity feedstocks that exceeded domestic supply. Imports, more than half from China in 2023, filled the gap. Changes to federal tax credits from 2025 reduced the incentive to use imported feedstocks.

What is the difference between yellow grease and choice white grease?

Choice white grease is a rendered pork fat produced mainly by meat processing plants. Yellow grease is mainly used cooking oil from kitchens. Both are listed as separate categories in USDA and EIA statistics.

Can brown grease be turned into fuel?

Yes, but it is harder and more expensive than yellow grease because of its high free fatty acid content and contamination. It can be used in anaerobic digesters to make biogas, and some specialised processes turn it into biodiesel.

Summary

Yellow grease is used cooking oil, mostly from restaurant fryers, collected, cleaned and sold as a commodity to a specification of roughly 15 percent maximum free fatty acids and 2 percent maximum impurities. For much of the 20th century it was a low-value by-product used mainly in animal feed and in soaps and other oleochemicals. Low-carbon fuel policy changed that. Because fuels made from waste oils earn low carbon intensity scores under programmes such as California's Low Carbon Fuel Standard and qualify under the federal Renewable Fuel Standard, yellow grease became one of the most sought-after feedstocks for biodiesel and renewable diesel. EIA data show more than 7 billion pounds going into US biofuels in 2024.

That success brought problems. Domestic supply could not keep up, imports surged, and questions arose about whether some imported "used" oil was genuine. Theft of restaurant grease grew into what the industry now estimates is a problem worth hundreds of millions of dollars a year, prompting federal prosecutions and state regulation. Environmentally, recycling used cooking oil helps keep grease out of sewers and produces fuels with genuinely lower lifecycle emissions, but the supply is finite, diverting it from feed has knock-on effects, and fraud can erode the benefits. Yellow grease is a small, unglamorous corner of the energy system, but it shows clearly how policy, markets and waste can combine to turn a nuisance into a valuable and contested resource.

Sources

• Yellow grease (Wikipedia)
• Rendering (animal products) (Wikipedia))
• US EIA: Monthly Biofuels Capacity and Feedstocks Update, Table 2
• US EIA: Renewable diesel is increasingly used to meet California's Low Carbon Fuel Standard (2018)
• USDA NASS: Fats and Oils, 2024 Summary (March 2025)
• USDA AMS: National Animal By-Product Feedstuff Report
• OSTI: Wiltsee, Urban Waste Grease Resource Assessment (NREL/SR-570-26141)
• farmdoc daily: Revisiting biomass-based diesel feedstock trends over 2011-2022 (January 2024)
• American Soybean Association: Used cooking oil imports for biofuels exceed expectations (2024)
• Transport Topics / Bloomberg: Suspicious Chinese frying oil hurting US biofuels business (May 2024)
• DTN: EPA auditing waste oil claimed in RFS (August 2024)
• Fastmarkets: US yellow grease Carolinas price assessment methodology
• QCIntel: Yellow grease delivered US Gulf assessment
• California Department of Food and Agriculture: Rendering Program FAQ
• WLOS / Associated Press: Prosecutor says theft ring took $4 million in used cooking oil (June 2019)
• CBS News: Why thieves smell treasure in used cooking oil (April 2019)
• Agri-Pulse: Used cooking oil heist highlights $500 million headache, group says (December 2025)
• Advanced BioFuels USA: NARA updates annual used cooking oil theft estimate to $300-500 million
• Biofuels Digest: Grease looting on the rise (2011)
• CNBC: 250-metre fatberg to be turned into biodiesel (September 2017)
• Argus Media: States ask EU to look into palm oil waste biofuels