As commodity prices skyrocket, used cooking oil has become a target of organized crime.
For the thrifty and waste-conscious farmer, grease is never garbage. Household and restaurant grease can be made into hog feed, for instance, or processed into biodiesel for farm machinery.
At Small Acres Farm, a mixed-vegetable organic farm in Washington state, the farm is almost entirely renewably run; in addition to on-farm solar panels and wind turbines that provide power, they’ve been using biodiesel — a renewable, biodegradable fuel made from vegetable oils, animal fats, or recycled grease— for more than a decade. Once a year, they purchase 275 gallons from a company in Seattle and use it to power their tractors and a delivery truck.
They’re not alone in seeing the potential in biodiesel. In the last two decades, as governments have sought to shift more people off fossil fuels, biofuel use has increased significantly, particularly for transportation (and increasingly, in home heating and electricity generation). That’s driven an increase in demand for used cooking oil — and in turn, hundreds of millions of dollars-worth of thefts.
Companies and industry groups say that these thefts are often connected to money laundering, as well as efforts to pass virgin oil off as recycled grease, as the latter type has become the more valuable of the two.
“There’s a lot of people making a lot of money,” said Sumit Majumdar, CEO of Buffalo Biodiesel, a used cooking oil recycler based in the U.S. and Canada. “It’s the legitimate operators that are getting pushed out.”
Cue the puns — and prepare to enter the greasy world of used cooking oil.
Greasy Gold
According to some estimates, per-capita consumption of fresh vegetable cooking oil in the United States is prolific, totalling roughly 10 gallons per year. In recent decades, the resulting glut of used cooking oil, once a liability for restaurants and other high-volume producers, has become a valuable commodity.
Often, the destination for used cooking oil is biofuels — displacing fossil fuels for trucks, tractors, and other machinery with a product that would otherwise go to waste.
At the level of values, that appeals to operators like Small Acres co-owner Chris Devine. Devine said it isn’t always easy to run machinery off biodiesel, but choosing to do so is in line with their ideals. “We’re choosing to do that because we want to not be purchasing fossil fuels for our farming operation,” he said.
“It’s more expensive — you get slightly less power out of the fuel than you would conventional diesel, and having to drive 200 miles to fill up the thing … is inconvenient. So that’s just strictly a value decision.”
In between being emptied out of the fryer and powering a tractor, crime is interceding.
At Buffalo Biodiesel, they’re focused on collecting used cooking oil from thousands of restaurants and other sources across the northeastern U.S., which they then sell as a feedstock to refineries producing sustainable aviation fuel and green diesel.
Twenty years ago, there were hundreds of small producers of biodiesel, Majumdar said, but over time, the industry has consolidated, with the remaining players being mostly major petroleum companies like British Petroleum and Chevron.
But in between being emptied out of the fryer and powering a tractor, crime is interceding.
In recent years, used cooking oil has become a target of organized theft rings, with dozens of people being charged with stealing cooking oil and laundering the proceeds through various channels. The way it works, according to Majumdar, is that organized crime groups pay cash for stolen cooking oil, which is sold to refineries; the refineries then pay the crime group for the oil, laundering the money.
“2025 losses are going to touch about $30 million. So that’s about 50 percent of our supply.”
The North American Renderer’s Association, an industry group, estimates that theft of used cooking oil totals around $500 million annually — and potentially as much $1 billion — up exponentially from $75 million in 1980. NARA executive director Kent Swisher confirmed suspicions that organized crime is involved. “It’s tied to money laundering, RICO stuff … human trafficking — it’s an income source for people doing all this other stuff.”
As an example, Swisher points to a case from mid-December, when a federal grand jury indicted 13 Chinese nationals on charges related to used cooking oil stolen from restaurant collection tanks in Iowa, Tennessee, and several other states. The 9-count indictment included money laundering, racketeering, and transporting stolen goods across state lines.
Majumdar said his own company’s losses will total in the millions of dollars this year, with thefts from restaurant storage tanks that number in the thousands. “2025 losses are going to touch about $30 million. So that’s about 50 percent of our supply.”
Behind those thefts is a well-intentioned attempt to make fuel more sustainable.
Industry Cleanup
One of these attempts is California’s Low Carbon Fuel Standard, said Andrew Swanson, professor in the department of agricultural economics at Montana State University. California provides subsidies for diesel from non-crop-based feedstocks, which includes used cooking oil and beef tallow, as they’re especially low-carbon, having been recycled. Thanks to this, used cooking oil provides the basis for 15-20 percent of the entire diesel market in the state (which in 2024 totaled 3.5 billion gallons).
At the federal level, there’s also the EPA’s Renewable Fuel Standard — which initially focused on corn ethanol, but has more recently shifted to alternative diesels including used cooking oil. This has increased the targets for the amount of biodiesel that producers are required to blend into petroleum diesel.
This shift significantly increased demand for feedstocks, fueling the black market. But — stolen or not — domestic production of used cooking oil is “nowhere near” enough to meet demand, said Swanson. (Though some estimates suggest only a quarter of vegetable oil used in food is recovered, often due to difficulties with collection.) As a result, imports of used cooking oil have increased significantly in recent years, particularly from China, Malaysia, and Indonesia.
This has its own problems. At times, the additional subsidies provided for used cooking oil have made it more valuable than virgin palm oil, creating an incentive for importers to pass virgin oil off as its used counterpart.
This means subsidies meant to encourage more sustainable fuels could instead be driving deforestation in places like Indonesia — a concern highlighted in 2024, when a group of U.S. senators issued a letter urging a crackdown on cooking oil imports, amidst concerns they could be mixed with virgin palm oil.
Stolen or not, domestic production of used cooking oil is “nowhere near” enough to meet demand.
A recent shift in federal policy, including a tax credit finalized under Biden and modified in the One Big Beautiful Bill, will shift demand away from imported feedstocks, Swanson said. (Among other changes, the Trump administration banned foreign feedstocks for biofuels, so that only feedstocks from Canada, Mexico, and the U.S. are eligible for the tax credit.)
This shift is ultimately aimed at helping domestic soybean producers, Swanson said — but it has implications for used cooking oil supplies as well. “With the restriction on imports, that means all domestic sources and feedstocks are going to become more valuable.”
Demand for biofuels is also likely to keep increasing. For something like sustainable aviation fuel alone — for which used cooking oil and other biofuel feedstocks are the only viable path, researchers say — the Biden administration had set a target of producing 3 billion gallons by 2030, up from 30 million today. “That is a possibility that a lot of biofuel producers … would like to see happen.”
Without sufficient regulatory oversight, Sumit Majumdar said this increase in demand will mean that taxpayer money dedicated to reducing emissions is instead continuing to subsidize organized crime. He added that improved regulation could look like collectors being registered federally in both Canada and the U.S., which would enhance traceability.
“The hope is that … a federal agency will get involved in regulating the industry.“
“You’ll eliminate most of the organized criminal gang activity because the stolen oil will be worthless,” he said. “The hope is that … a federal agency will get involved in regulating the industry, and deliver to the public that’s paying the [price], the sustainability and the traceability. And once that happens, I think that’s going to fix the problem.”
In the meantime, Buffalo Biodiesel is working on technology to address break-ins, Mujamdar said, including adding devices to monitor the amount of oil in their storage tanks, for theft prevention; so far, they haven’t stopped thieves, he admits, but it’s made their collection more efficient.
As for Chris Devine, he said he’s surprised that people would bother to steal something as messy and seemingly low-value as used cooking oil. He notes that biodiesel itself has its issues — in addition to being hard to source, it degrades natural rubber over time, which meant they had to replace the fuel lines in their tractors. Biodiesel also doesn’t work as well in cold temperatures, and has to be blended with petroleum diesel to work in modern engines.
But at least for now, biodiesel offers a way for small producers to reduce their emissions, and Devine’s example has prompted some other local farms to follow suit. “[It’s] not that much more expensive and you feel a little better about it.”
