Used Cooking Oil Imports from China Surge on Biofuel Demand

Key Details U.S. imports of used cooking oil (UCO) from China are accelerating rapidly as new biofuel-blending mandates take effect. Two recent cargo shipments totaling 339,000 barrels arrived in the past month, marking the largest imports this year. About half went to Port Arthur, Texas, where Valero Energy and Darling Ingredients operate the Diamond Green Diesel facility. Why It Matters The Trump administration's renewable fuels plan requires record biofuel volumes mixed into diesel and gasoline supplies in 2025. Rising oil prices from Middle East tensions have made imported UCO cost-competitive against domestic feedstocks like soybean oil. Renewable fuel producers are racing to secure feedstocks and capitalize on high compliance credit prices tied to renewable volume obligations (RVOs). Market Impact Soybean oil prices hit their highest level since November 2022, while the premium between soybean and imported UCO has climbed to a four-year high. Rendered beef tallow prices have also reached record levels in Chicago. Industry analysts expect more UCO shipments as the gap between mandated volumes and domestic supply remains substantial, despite prior backlash from farmers and domestic soybean processors concerned about foreign competition.