China’s UCO Exports to U.S. — UCO or fraud?
In 2021 China’s used cooking oil (UCO) exports to the U.S. were 0.4% imported into the U.S. In 2024 China’s share of US imports was 58%. This unprecedented export boom of UCO to the US has done significant damage to the biodiesel feedstock market. Interestingly, many question whether this Chinese UCO is in fact used cooking oil or, perhaps, adulterated palm oil.
The damage this boom is causing affects soybean growers, canola oil producers and used cooking oil collectors by depressing demand for their products, (which are used to make renewable diesel fuel) and driving prices downward. The result is a dramatic reduction in profits for soybean growers and used cooking oil collectors. This, in turn, disrupts the extremely important market for renewable diesel.
In July, the European Commission imposed anti-dumping tariffs of 36.4% on Chinese UCO imports into the European Union.
The European Commission said, “tariffs alone will not be enough to prevent fraudulently mislabeled palm oil from entering the European market.” Palm Oil has been associated with deforestation and does not represent the low carbon intensity feedstock the EPA rewards with RFS credits.
Senators Joni Ernst, Amy Klobuchar and four of their colleagues sent a letter to EPA administrator Michael Regan who promised an investigation back in June. This new letter, dated December 13, states that, “it is the duty of the EPA to confirm any gallon of renewable fuel generating a renewable identification number (RIN) is from a qualifying feedstock.”
What is the solution to the surge of tainted Chinese cooking oil?
The only solution is a robust verification process. The senators said that as it stands right now, a mixture of 99% virgin palm oil with 1% used cooking oil would be classified as used cooking oil under the current classification system. Testing and verification is needed to ensure these feedstocks are what they are supposed to be.
Geoff Cooper, CEO of the Renewable Fuels Association, speaking to ResourceWise stated that “We are concerned that unless EPA and other agencies get a handle on this pretty quickly, it could potentially undermine the integrity of the Renewable Fuel Standard.”
Last year the EPA implemented onerous new rules for the sourcing and verification of used cooking oil collected from restaurants in the United States. This onerous tracking system is intended to insure that domestic UCO is the low carbon intensity feedstock that it is supposed to be. Yet, “cooking oil” imported from China has no tracking requirements nor independent verification system to insure its authenticity.
The EPA needs to step up to the plate to insure the integrity of the RFS system it created and insure that renewable diesel produced in the US meets the standards for low carbon intensity prescribed by the EPA.
Contact your senators to lobby for regulations to protect American collectors and producers.