Japan Used Cooking Oil Market Overview, 2031

Japan Used Cooking Oil Market Japan

• Japan’s Used Cooking Oil market operates under a persistent structural constraint where domestic UCO generation meets only 45–55 percent of total biofuel feedstock demand in 2025, according to METI-linked biomass utilization estimates. This gap has intensified following Japan’s GX (Green Transformation) Basic Policy announced in February 2023, which targets 10 billion liters of SAF consumption by 2030, forcing refiners and trading houses such as ENEOS, Idemitsu Kosan, and Cosmo Oil to aggressively secure imported UCO from Southeast Asia and North America.
• According to the research report, " Japan Used Cooking Oil Market Outlook, 2031," published by Bonafide Research, the Japan Used Cooking Oil market is anticipated to grow at more than 8.69% CAGR from 2026 to 2031. Japan relies heavily on imports routed through Yokohama, Kobe, and Chiba ports, which together handle nearly 80–85 percent of UCO inflows. Imported ISCC-certified UCO prices ranged between USD 980 and USD 1,250 per metric ton in 2025, significantly higher than domestic collection costs of approximately USD 650–780 per ton, reflecting certification premiums and logistics constraints.
• The aviation sector, led by ANA Holdings and Japan Airlines JAL, has committed to using SAF blends of up to 10 percent by 2030, creating long-term demand certainty. Meanwhile, shipping conglomerates such as NYK Line and Mitsui O.S.K. Lines MOL are integrating circular fuel strategies that indirectly increase demand for UCO-derived marine biofuels.

PESTLE Analysis

• Japan’s Green Transformation GX policy framework, reinforced in April 2024 GX Promotion Act implementation phase 1, provides subsidies of approximately JPY 30–40 per liter equivalent for SAF development pilots, directly improving viability of UCO-based aviation fuel supply chains. The Ministry of Economy, Trade and Industry METI continues to prioritize energy security, especially after the volatility in LNG imports post-2022.
• UCO procurement costs in Japan remain among the highest in Asia at approximately JPY 140,000 to 180,000 per ton in 2025, driven by limited domestic supply and high logistics costs across island distribution networks. Tokyo and Osaka exhibit the highest collection density but also the highest operational costs, with transportation expenses accounting for nearly 18–22 percent of total collection cost structures.
• Japan’s disciplined waste segregation culture contributes to relatively high compliance rates in urban households, particularly in Tokyo, Yokohama, and Osaka, where household participation in recycling programs exceeds 35 percent, significantly higher than many OECD peers. However, rural prefectures such as Hokkaido and Tohoku show participation below 20 percent, creating regional imbalance in feedstock availability.
• Companies like JGC Holdings and Revo International (Kyoto-based) have deployed advanced esterification and hydrotreated renewable fuel technologies, improving UCO conversion efficiency by approximately 15–18 percent between 2023 and 2025. Smart collection systems using QR-based tracking are increasingly adopted in Kyoto and Kanagawa prefectures, reducing contamination rates below 4–6 percent.
• Japan’s Waste Management and Public Cleansing Law strictly governs UCO handling, requiring licensed collectors and traceability documentation. Compliance audits conducted by local municipalities such as Tokyo Metropolitan Government have identified irregular disposal practices accounting for nearly 5–7 percent of total commercial waste oil streams.
• Lifecycle assessments conducted by Japan Petroleum Energy Center show that UCO-derived biodiesel reduces CO2 emissions by approximately 75–88 percent compared to fossil diesel, aligning with Japan’s 2050 carbon neutrality target announced in October 2020 and reinforced in updated GX roadmap 2024.

Recent Industry Developments (2024–2026)

ENEOS SAF pilot expansion at Wakayama refinery June 2025
ENEOS expanded its SAF demonstration facility in Wakayama with a target capacity of 300,000 kiloliters per year by 2027, significantly increasing UCO procurement requirements from both domestic collectors and imported certified suppliers.
Japan Airlines JAL SAF procurement agreement March 2024
JAL signed long-term SAF supply agreements with Neste and ENEOS, targeting 10 percent SAF blending by 2030, with early-stage consumption equivalent to nearly 100,000 kiloliters annually by 2026.
Revo International export expansion Kyoto November 2024
Revo International increased its UCO export operations to Europe, particularly Netherlands and Germany, reaching approximately 120,000 tons annually, positioning Japan as both importer and selective exporter of high-grade processed UCO.

Regulatory Landscape

• Japan’s regulatory framework is governed by the Ministry of the Environment MOEJ and METI, under the Waste Management and Public Cleansing Law and GX policy architecture. The government introduced stricter lifecycle carbon accounting standards in April 2024, requiring full traceability for biofuel feedstocks used in aviation and transport sectors.
• SAF development is supported through subsidies covering up to 30–40 percent of capital expenditure for pilot-scale projects, making Japan one of the most policy-supported SAF markets in Asia. Certification alignment with international standards such as ISCC and RSB is mandatory for export-oriented UCO supply chains.

Value Creation Hotspots Across the Supply Chain

• Major metropolitan areas such as Tokyo, Osaka, and Nagoya generate concentrated UCO streams from over 120,000 food service establishments nationwide, with integrated collection networks operated by firms like Nippon Paper Group and Revo International affiliates, improving margin efficiency by 12–16 percent through route optimization systems.
• Aggregation hubs in Kanagawa and Osaka prefectures capture significant value through centralized processing, reducing contamination and improving feedstock classification accuracy by nearly 20 percent compared to decentralized systems.
• ISCC-certified processing facilities in Kyoto and Tokyo achieve price premiums of approximately USD 100–180 per ton, driven by strict EU and US import requirements for SAF-grade feedstock.
• Refiners such as ENEOS and Idemitsu benefit from GX-linked subsidies and carbon credit mechanisms, improving project IRR by nearly 3–5 percentage points compared to non-subsidized scenarios.
• SAF facilities integrated with airport fuel supply chains at Narita and Haneda airports capture the highest value, with long-term airline contracts priced 25–40 percent above conventional jet fuel parity economics.

Import Dependency Analysis

• Japan imports approximately 50–60 percent of its total UCO requirement, primarily from Malaysia, Indonesia, China, and the United States, driven by limited domestic supply and high SAF demand growth.
• Yokohama port alone handles nearly 35–40 percent of total imports, making it the most critical logistics node. Import dependency is expected to rise further as SAF demand increases toward 2030, with potential import volumes growing by 20–25 percent annually under GX policy trajectory.

Segment Analysis

By Source
Food Service dominates Japan’s UCO generation, contributing approximately 70–75 percent of total supply, driven by dense urban restaurant ecosystems in Tokyo, Osaka, and Nagoya. Food Processing accounts for around 15–18 percent, primarily concentrated in industrial zones such as Aichi and Kanagawa. Household sources contribute approximately 8–10 percent, but exhibit relatively high compliance efficiency due to structured waste segregation systems. Other sources, including institutional kitchens and corporate cafeterias, account for the remaining share.
By Application
Biodiesel Production accounts for approximately 35–40 percent of demand, primarily used in municipal transport and industrial heating applications. Renewable Diesel Production is expanding rapidly at around 25–30 percent share, driven by refinery investments in Tokyo Bay and Kansai. Sustainable Aviation Fuel represents the fastest-growing segment at approximately 20–25 percent share, supported by ANA and JAL commitments. Oleochemicals, Soaps and Detergents, and other industrial uses collectively account for the remaining share, concentrated in chemical clusters in Osaka and Chiba.
By Collection Method
Direct Commercial Collection dominates with approximately 55–60 percent share, supported by structured contracts with foodservice chains. Third-Party Waste Aggregators account for around 20–25 percent share, particularly active in metropolitan areas. Municipal Collection Systems contribute approximately 10–12 percent share, supported by strict local waste regulations in cities like Tokyo. Household Drop-off and Recycling Programs remain underutilized at below 10 percent share, although participation rates are higher than most OECD countries due to cultural compliance norms.


Considered in this report
• Historic Year: 2020
• Base year: 2025
• Estimated year: 2026
• Forecast year: 2031

Aspects covered in this report
• Mixed Used Cooking Oil Market with its value and forecast along with its segments
• Various drivers and challenges
• On-going trends and developments
• Top profiled companies
• Strategic recommendation

By Source
• Food Service
• Food Processing
• Household
• Others

By Application
• Biodiesel Production
• Renewable Diesel Production
• Sustainable Aviation Fuel
• Oleochemicals
• Soaps & Detergents
• Others

By Collection Method
• Direct Commercial Collection
• Third-Party Waste Aggregators
• Municipal Collection Systems
• Household Drop-off / Recycling Programs
• Others