WHAT IS IT?
Used Cooking Oil (UCO) is vegetable oil that has been previously used for cooking in restaurants, food manufacturers, or households, then collected, filtered, and sold as a biofuel feedstock. It is the most valuable waste-based biofuel feedstock globally.
WHY UCO IS PREMIUM
Under the EU Renewable Energy Directive (RED II), UCO is classified as a waste feedstock — meaning it is 'double counted' toward renewable energy targets. This means 1 tonne of UCO-based fuel counts as 2 tonnes of renewable fuel for compliance purposes, making it worth significantly more than virgin vegetable oil-based alternatives.
SUPPLY CHAIN
• Restaurants and food processors generate used cooking oil
• Collection companies gather and aggregate it
• Pre-processors filter, dewater, and test for quality
• Sold to HVO or FAME biodiesel producers
• Certified material traced via mass balance under ISCC
QUALITY PARAMETERS
Free Fatty Acid (FFA): max 10–15% (higher than virgin oils — due to degradation)
Moisture: max 2%
Insoluble impurities: max 1%
Phosphorus: max 50 ppm
MIU (Moisture, Impurities, Unsaponifiables): key refining cost driver
Iodine Value (IV): measure of unsaturation
Positive ISCC certification documentation
KEY USES
HVO (Hydrotreated Vegetable Oil) production — renewable diesel
FAME biodiesel (B5, B7, B20 blending)
SAF (Sustainable Aviation Fuel) via HEFA process
TRADE CORRIDORS
Major suppliers: China (world's largest UCO exporter), Malaysia, Indonesia, European countries
Major buyers: European HVO/biodiesel producers (Netherlands, Finland, Germany)
Tetra relevance: Southeast Asia → Europe corridor. Singapore is a key UCO aggregation and trading hub.
FRAUD RISK — CRITICAL
UCO commands a 3–5× premium over fossil diesel. This creates significant fraud risk:
Virgin palm or soybean oil fraudulently sold as UCO
Mineral oil adulteration
Forged ISCC certificates
Buyers must conduct lab testing (fatty acid profile, sterol analysis) and third-party audits. EU has tightened import controls significantly since 2023.