China's Cooking Oil Is Coming Back to America. The Math Says It Cannot Last.
Two cargoes do not reverse a structural shift. The April reopening is a margin event, not a market reset.
On 28 April, Bloomberg reported that two cargoes of Chinese used cooking oil totaling roughly 339,000 barrels arrived in the United States over the past month. About half went to Port Arthur, Texas, the home of Diamond Green Diesel. These were the largest UCO imports of 2026 and the first meaningful shipments since the Trump administration imposed a 125% tariff in April 2025 that effectively closed the trade.
The narrative writing itself in trade media this week is straightforward. US blending mandates are climbing. Soybean oil and tallow have hit multi-year and record highs. The Iran conflict is pushing oil and fertilizer prices up. So American renewable diesel producers are paying enough to absorb the tariff and bring Chinese UCO back through the door.
That narrative is correct, and it is incomplete. The supply available to come back through that door is much smaller than it was in 2024, and it is shrinking for reasons that have nothing to do with US trade policy.
The structural number
Sustainable aviation fuel plants that are already operating around the world, and that list used cooking oil among their feedstocks, have a combined SAF output capacity of roughly 6,200 kilotonnes per year. To produce that SAF, those plants need to draw in approximately 7,400 kilotonnes per year of lipid feedstock. UCO, tallow, palm fatty acid distillate, and vegetable oils all compete inside that requirement, and the mix shifts with prices and certification rules.
China’s used cooking oil exports in 2024 hit an all-time record of roughly 3,000 kilotonnes. That was the absolute peak under the most favourable conditions: US arbitrage open, Chinese export tax rebates intact, no domestic SAF competition for the molecule.
Operating SAF capacity already eats more lipid feedstock, in total, than China sent to the world in its best-ever year. Even if UCO accounts for only half of that operating SAF feedstock pool, the implied UCO demand from operating SAF facilities alone is in the same range as China’s entire record export volume. And that is before adding the global renewable diesel fleet, which is several times larger than the SAF fleet and uses the same feedstock.
That is the structural picture. The April cargoes do not change it.
Why China keeps shrinking as a supplier
Three things are happening inside China that take UCO molecules out of the export pool, regardless of what Washington does.
First, Beijing removed UCO export tax rebates in late 2024 and has not reinstated them. That alone reduces the economic incentive for Chinese exporters.
Second, China has built and is building a domestic SAF industry. The first commercial Chinese SAF plants began operating in 2024 and 2025. Several more are under construction. These plants run on Chinese UCO that previously moved offshore.
Third, China has also been expanding domestic renewable diesel and biodiesel capacity, which competes with SAF for the same feedstock pool.
The combined effect is that Chinese UCO export volumes have been declining since late 2024, well before the US tariff, and they continue to decline now even as the April 2026 cargoes show that some arbitrage is reopening at the right price. The supply that can come back is a smaller share of a smaller pool.
Three numbers worth holding
~6,200 kt/yr. Operating SAF capacity globally that depends on used cooking oil among its feedstocks. This is contracted demand competing for every available tonne of waste oil.
~3,000 kt/yr. China’s record 2024 UCO exports. The April 2026 cargoes do not lift the ceiling on how much Chinese UCO can be available to global buyers in any year. They redistribute it.
Three. The number of operating SAF plants in the United States that list UCO among their feedstocks. The American buyer base for Chinese UCO at the SAF level has not expanded since 2024. The competition for it has.
What this means commercially
For renewable diesel and SAF producers in the US, the April reopening is welcome margin relief but not a structural fix. The molecule that made it through this month is the same molecule that European and non-China Asian producers were planning to source. Some Chinese UCO is now flowing west again. Some that would have flowed to Europe or Singapore is being redirected to Port Arthur. The total available pool has not grown.
For European producers, the April reopening is a soft pricing headwind. Chinese UCO that lands in Houston is Chinese UCO that does not land in Rotterdam. The EU has been the net beneficiary of the 2025 trade redirection. That benefit is partially reversing.
For feedstock traders and analysts, the durable signal is the structural one. Chinese domestic SAF capacity is growing. Beijing’s policy signals point to retaining more UCO at home. The 2024 export pool was a peak, not a baseline.
For aviation fuel buyers and offtake counterparties, the implication is that UCO-derived SAF supply has a tighter ceiling than the SAF capacity buildout might suggest. Project announcements based on assumed UCO availability deserve a second look against the export math.
Caveats
The supply-demand math above is based on a structured database of every commercial-stage SAF project worldwide that Axial Intelligence maintains. The 6,200 kt/yr operating SAF capacity figure and the 7,400 kt/yr lipid feedstock requirement are both derived from that dataset using a documented yield ratio for hydroprocessing. UCO share within multi-feedstock plants is operator-decided and shifts with prices and policy. The April reopening is recent. Two cargoes do not establish a trend.
The full project-level breakdown is in the paid edition. It identifies every operating, construction-stage, and FID-stage SAF facility worldwide that depends on UCO, ranked by capacity and grouped by region, country, and operator. It separates Chinese plants that are taking UCO out of the export pool from European and non-China Asian plants that compete with US Gulf Coast buyers for what remains. It includes operator-level rankings and the implied feedstock pull from the construction pipeline that will commission over the next two to three years.
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Data: Axial Intelligence SAF Project Tracker, April 2026. Market reporting: Bloomberg, Transport Topics, Reuters, advancedbiofuelsusa.info, Biofuels International, ResourceWise, 28 April 2026 reporting cycle and prior coverage.
Axial Intelligence · SAF Project Tracker · April 2026