Post-industrial 4.0 revolution, due to the increasing urbanization coupled with digitalization and innovation of path-breaking techniques, the world is currently facing growing global demand influx. Furthermore, the constant requirement change and affinition towards the green and sustainable environment have paved opportunities for various players to capitalize on the growing market. This has given rise to the concept of biodiesel, which in return is raising the global used cooking oil market size. While the automotive sector is upsurging with a production of 95.63 billion cars as of 2018, the global air pollution has become the fifth leading risk of mortality worldwide. Therefore, biodiesel or biofuel can bring emission rates in control, as well as act as a substitute for the fast depleting fossil fuels. Biodiesel produced from used cooking oil or edible oil can result in an 84% reduction in carbon footprint compared with fossil diesel, without any modifications to the vehicle. Hence, the global concern for a pollution-free world will further drive the used cooking oil market. Several governmental policies are undertaken to stop polluting the environment by throwing used cooking oil in waterbeds or reselling them to local vendors for reuse. Instead, the government is asking the consumers to use it in the procurement of biodiesel. For instance, in August 2019, Petroleum and Natural Gas Minister of India announced the launch Repurpose Used Cooking Oil (RUCO) program and mobile phone application for collection of used cooking oil (UCO) for converting it to biodiesel in 100 cities across the country, on behalf of state-run oil marketing companies such as IndianOil, Bharat Petroleum, and Hindustan Petroleum. Also, in February 2019, Muenzer Bharat, a biodiesel manufacturing company of the subcontinent announced the production of 100% water-based biodiesel from used cooking oil, which can be used for gensets to produce electric energy or can be blended with diesel to make environment-friendly vehicles. Almost 8.5 billion liters of diesel is consumed by India, in every month, and the latest governmental policies aim to blend 5% of it in a diesel by 2030.
As of 2018, the global used cooking oil market size was evaluated at around $500.61 million, which has the potential to witness increment at a CAGR of 3.6% during the forecast period 2019-2025. The report details used cooking oil market size by type and market size by applications, used cooking oil market share by top 5 companies and also the market share by startups.
The transport biofuel production elevated 7% year-on-year in 2018 and a 3% annual production growth is expected to be witnessed in the next five years. However, this falls short of the targeted 10% output growth per year, according to the Sustainable Development Goals until 2030. This trade influx can be managed through the increasing used cooking oil market demand, as cooking oils such as corn oil, peanut oil, sunflower oil, and others can produce biodiesel. Moreover, the edible oil market was evaluated at $90.1 billion in 2018, is projected to expand at a CAGR of 6% during the forecast period 2019-2025. Neutral Fuels, the UAE-based biodiesel manufacturer has been supplying biodiesel produced from used cooking oil for a long time. However, the challenge of sourcing good quality used cooking oil has compelled them towards a ground-breaking shift. From a strain of enzyme derived from the fungus that grows on a soybean, they have converted bad used cooking oil into good biodiesel in May 2017. This breakthrough innovation will entice several used cooking oil suppliers, paving impeccable revenue to the used cooking oil market.
Used Cooking Oil Market Analysis: Key Application (By Source)
Used cooking oil can be obtained from various sources such as household, commercial factories, and others. However, the major procurement of used cooking oil is through the Horeca or the foodservice industry including hotels, restaurants, and cafes. Driven by the expanding economy, disposable income and shifting dietary choices are registering a positive sales growth in the global restaurant industry. The US industry is projected to collect a revenue avenue of $863 billion in 2019, creating 1.6 million new jobs by 2029. On the other hand, the UK hospitality industry represents 6% of businesses and 5% of GDP. Therefore a huge amount of used cooking oil is produced through the several dishes made in these eateries. Moreover, the hospitality industry stands at a valuation of $4 billion. India uses 27 billion liters of cooking oil, out of which around 1.4 billion UCO can be acquired from bulk users such as restaurants, hotel, and canteens for conversion, yielding around 1.1 billion liters of biodiesel every year. For instance, a Haryana Entrepreneur collects used cooking oil from popular food chain outlets and invests in the making biofuel. The acquisition source of used cooking oil from Horeca is projected to escalate at a CAGR of 3.1% during the forecast period 2019-2025.
Europe Used Cooking Oil Market Overview:
The potential amount of used cooking oil (UCO) to be collected is 8 liters UCO per capita per year, amounting to around 4 million ton of used cooking oil annually, which is 7 times lesser than the current collected amount. However, the increasing usage of cooking oil will potentially increase the collected used cooking oil amount by 2% per year. In 2018, Europe grabbed the largest cooking oil market share of around 35.19% amidst the global market. Europe has undertaken several strategies such as BIOSIRE project to enhance the used cooking oil market growth through its collection and supply chain modification. Several companies are investing in procuring renewable oil and biofuel from the used cooking oil. For instance, Neste Oil has developed the NexBTL process for manufacturing of renewable diesel fuel from used cooking oil. In Greece, CEPRU has developed the BIOFUELS-2G project to convert collected used cooking oil to biofuels. In the UK, used cooking oil derived biodiesel currently accounts for a third of biodiesel supplied to the biofuel market. European Commission is further undertaking policies to enlighten the population to utilize used cooking oil and not dump it on waterbeds. RECOIL initiative aims to replace 1.5% of the EU27 diesel consumption by biodiesel manufactured from used edible oil, contributing to the sustainable 2020 targets of the country. Also, Alternative Technology Group GMBH's vegetable oil conversion system has retrofitted 10,000 diesel engines and vehicles with the conversion system that supports the operation of diesel engines and vehicles with straight vegetable oil or waste vegetable oil. Moreover, oleochemicals derived from the used cooking oil are used in the production of laundry detergent and soaps. In 2018, the market value of the household care and professional cleaning and hygiene sector in Europe was estimated at $40.30 trillion in 2018, witnessing a growth of 1.4% from 2017. A part of it is contributing to the growth of the used cooking oil market of the region, thereby, paving opportunities for the market players in the upcoming years.
Used Cooking Oil Market Trends & Growth Drivers:
More and more people are seeking alternative fuel sources due to rising fuel prices and increasing carbon emission, creating problems like smog, pollution, global warming, and others. Innovations such as Veggie Oil Car System has made the conversion of waste oil or used cooking oil to green fuels possible, supporting the automotive industry. Since April 2020, the Indian auto industry is set to witness the BS6 regime by the Supreme Court's order. To keep the emissions level at a check, the Indian government has been implementing the Bharat Stage (BS) norms from 2000, which are based on European emission standards. The biodiesel derived from used cooking oil can be used to control this emission process. On the other hand, the aviation industry is one of the significant contributors of carbon dioxide to the atmosphere. It can be seized by fuel derived from used cooking oil. In November 2017, Hainan Airlines flight from Beijing landed at Chicago's O'Hare International Airport, which covered a distance of 11,297 kilometers with biofuel produced from waste cooking oil by China Petroleum and Chemical Corp. Also, a startup company on June 2018 initiated collection of waste cooking oil to reduce low-carbon green fuel for use in diesel vehicles. Moreover, the Food Safety and Standards Authority of India (FSSAI) has decided to implement regulation to create an eco-system for the collection of used cooking oil to produce biodiesel. On the other hand, in 2016, BIODEX-SA, a company based in Tunisia achieved the Roundtable on Sustainable Biomaterials (RSB) certification for collection of used cooking oil and manufacturing of biodiesel from it in Africa for the first time. All of these are contributing to the growth and prosper of the used cooking oil market worldwide.
Used Cooking Oil Market: Competitive Landscape
The principal business leaders who are currently holding maximum used cooking oil market shares in the world and are focusing on the expansion of their manufacturing capacity to gain an edge over other market players are Argent Energy, Baker Commodities Inc., Biomotive Fuels Ltd., Brocklesby Ltd., Darling Ingredients, Devon Biofuels Ltd, Greenergy International Ltd, Harvest Energy Ltd., Lywood Consulting Limited, Nidera B.V., and others.
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