stockrowWhat it does
Darling Ingredients collects animal by-products, used cooking oil and other residual materials and turns them into ingredients for businesses around the world. Its customers use those ingredients in animal feed, pet food, food, pharmaceuticals, industrial products, fertilizers and fuels.
The company’s Feed Ingredients business processes materials such as fat, bones, blood and bakery leftovers into products including protein meals, fats and pet food ingredients. Its Food Ingredients business makes collagen from hides, skins and bones, as well as natural casings used in sausages and other products. Its Fuel Ingredients business includes an investment in Diamond Green Diesel, a joint venture with Valero Energy Corporation that makes renewable diesel and sustainable aviation fuel from fats and oils.
Darling also provides collection services. It picks up animal by-products from sources including slaughterhouses, grocery stores and butcher shops, and collects used cooking oil from restaurants and other businesses. The materials are transported to plants for processing into saleable products. The company sold the majority of its grease-trap business in July 2026.
Darling is headquartered in Irving, Texas. Randall C. Stuewe is chairman and chief executive officer. The company had 15,000 employees in FY2025.
How it makes money
Darling earns revenue primarily by collecting and processing residual materials, then selling the resulting ingredients. It also charges collection fees under some supplier arrangements and receives its share of results from its investment in Diamond Green Diesel.
Feed Ingredients sells fats and protein meals for animal feed, pet food, biofuels and industrial uses. It also processes bakery leftovers into animal feed and sells blood products and fertilizers. Food Ingredients sells collagen for food, nutritional supplements, pharmaceutical and technical applications, as well as natural casings and other specialty products. Fuel Ingredients includes Darling’s share of Diamond Green Diesel’s results and European activities such as making biogas from organic sludge and food waste.
Darling generally sells its principal finished products at prevailing prices. Many compete with agricultural commodities, so prices can change with those markets. Products made using specialized processing, including certain pet food ingredients and collagen products, command higher prices than principal product lines. Collagen customers may value consistent quality, reliable supply and application support; its profitability also depends on passing raw-material cost increases through to customers.
Collection and processing are ongoing activities, with some raw materials obtained under multi-year supplier contracts and some premium products sold under supply contracts. Diamond Green Diesel sells fuels to distributors, blenders and other buyers; it is accounted for as an investment in an unconsolidated subsidiary.
Darling generated $6.1 billion in revenue in fiscal year 2025 and $1.7 billion in net sales in the second quarter of 2026.
Customers and how it sells
Darling sells to producers of animal feed, pet food, renewable fuels, fertilizer and other consumer and industrial products. Feed mills buy meals, fats, blood products and bakery-derived ingredients. Pet food manufacturers buy ingredients made to particular safety and quality specifications, sometimes under supply contracts. Collagen customers include companies in food, nutritional supplements and pharmaceuticals, while natural casings are sold to sausage makers and other food producers.
Diamond Green Diesel is the primary customer for Darling’s collected used cooking oil. The joint venture sells renewable fuels primarily to resellers, distributors and blenders, and sometimes to companies subject to renewable-fuel obligations. Darling has signed an agreement to sell its European casings business and expects the transaction to close by the end of 2026.
The company operates on five continents and sells finished products worldwide. It uses commodity trading departments and sales offices to coordinate sales and distribution, and also sells through brokers and agents in some markets. Its collagen business has production in Europe, China, South America and the United States. Darling’s international operations also process animal by-products in Europe, China and South America.
Darling identifies concentration among suppliers and customers as a risk, but does not provide a customer revenue share in the available company descriptions.
Suppliers and costs
Darling collects animal by-products from slaughterhouses, grocery stores, butcher shops and food service establishments. Restaurants, industrial operations and grocery stores supply used cooking oil, while commercial bakeries supply bakery residuals. Materials are transported to processing plants, where animal by-products are ground, heated and separated into fats and protein meals.
Supplier arrangements may link the charge or credit for raw material to finished-product prices, after processing, freight and other fees. Other arrangements use a fixed price, no payment or a collection fee. Approximately 91% of Darling’s U.S. volume of raw materials in fiscal year 2025 was acquired on a formula basis. Because much of its supply is a by-product of food production, Darling cannot contract with suppliers to increase output whenever demand for its products rises.
Some facilities depend on one or a few suppliers. In fiscal year 2025, the 10 largest North American raw-material suppliers accounted for approximately 39% of the total raw material Darling processed in that region. Costs include raw materials, collection, freight, factory expenses and labor. The company also depends on natural gas, diesel and electricity, whose prices can be volatile.
- Revenue$6.1B
- Cost of revenue−$4.7B
- Selling, general and administrative−$551.2M
- Other operating costs−$648.9M
- Operating income$273.4M
Competitive position
Darling competes for raw materials as well as customers for its finished products. In the U.S. products business, it names Cargill, Tyson Foods and JBS & Company among its competitors. It also competes with regional and local renderers, restaurant service providers and bakery recyclers, as well as alternative disposal providers such as waste management and renewable energy companies.
Competition for raw materials is primarily based on price and proximity to the supplier. Some meat processors use rendering operations integrated with their own packing facilities, reducing the material available to independent processors. Darling’s finished ingredients also compete with alternatives such as soybean meal and vegetable oils.
Our reading: Darling’s collection and processing network is a meaningful competitive asset because proximity matters when procuring materials, but it does not eliminate competition from integrated renderers or local operators.
Our reading: Specialized processing and customer requirements offer another source of differentiation, particularly in collagen and pet food ingredients, although customers can also choose competing ingredients and suppliers.
In parts of Europe, Darling’s Rendac business collects fallen stock under a regulated system in which government contracts provide exclusivity to the contracted partner. Our reading: Those exclusive contracts can protect the business locally for their duration, but they do not provide exclusivity across Darling’s wider portfolio.
| Competitor | Where they compete | Threat (our reading) |
|---|---|---|
| Cargill, Inc. | U.S. products business | Medium |
| Tyson Foods, Inc. | U.S. products business | Medium |
| JBS & Company | U.S. products business | Medium |
Growth opportunities
Darling is pursuing growth through existing plants, acquisitions and changes to its product mix. The company says it can increase cash generated from its ingredients assets through contract terms, commercial optimization and price-risk management. It has identified an opportunity to generate an additional $150 million-$300 million in adjusted EBITDA over the following three years from those actions.
In Food Ingredients, Darling is increasing its mix of collagen and targeted health ingredients produced using existing factories. The company says collagen sales have improved year over year, supported by customer demand and new applications in food, nutrition and health. It has approved a collagen spray dryer in Kaiping, China, and additional extraction and spray-drying capacity in Paraguay.
Darling acquired three rendering facilities from the Potenze Group in Brazil. The company says its Brazilian rendering operations are out of capacity and it is considering expansion. It also intends to pursue expansions in collagen and some rendering operations rather than focus on another large acquisition.
In Fuel Ingredients, Diamond Green Diesel can produce renewable diesel and sustainable aviation fuel. Darling says its existing U.S. voluntary-market aviation fuel sales command a premium over renewable diesel. The company and Tessenderlo have agreed to contribute collagen and gelatin assets to a proposed joint venture, subject to regulatory approvals and other closing conditions.
- $4.7BFY2021
- $6.5BFY2022
- $6.8BFY2023
- $5.7BFY2024
- $6.1BFY2025
Structural risks
- Commodity prices: Prices for many finished products are volatile and influenced by agricultural commodity markets. Even when raw-material costs are indexed to finished-product prices, rapid price changes can affect margins before costs adjust.
- Supply access: Raw-material procurement is competitive, and some facilities rely on one or a few suppliers. Supplier shutdowns, interruptions or decisions to use another disposal method could affect dependent facilities.
- Renewable-fuel policy: Diamond Green Diesel and other renewable-energy activities depend on government programs, incentives and regulations that can change. Changes to tax credits and tariffs contributed to lower renewable-fuel margins in fiscal year 2025.
- Energy and operations: Darling depends on natural gas, diesel and electricity. Volatile energy prices, severe weather and interruptions at individual facilities can affect costs, raw-material collection and production.
- Debt and liquidity: Darling has substantial indebtedness and may not generate enough cash to service all its debt. Commodity prices, energy costs and changes in government programs can also affect liquidity.
- Regulation and safety: The business faces environmental, health and safety requirements, as well as risks from animal disease, product recalls and food-safety issues. Compliance costs, claims or disruptions can affect operations.
Bottom line
Our reading
Our reading: Darling is a collection and processing business whose earnings depend on turning residual materials into ingredients and fuels across several end markets. Its network and specialized products provide ways to compete, while formula-based sourcing can cushion some commodity-price movements. The business remains exposed to raw-material availability, energy costs and renewable-fuel policy, and its joint venture can contribute substantially different results as fuel margins change.