An introduction to biodiesel, the typical manufacturing process. Biodiesel production is the process of producing the biofuel, biodiesel, through the chemical reactions of transesterification and esterification. Biodiesel is a liquid biofuel obtained by chemical processes on vegetable oils(used or unused) or animal fats. Due to the rapid decline in crude oil reserves, the use of vegetable oils as diesel fuels is again promoted in many countries. Depending upon climate and soil conditions, different nations are looking into different vegetable oils for diesel fuels.