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https://wiki.captain-of-industry.com/Cooking_Oil
But yes, right now the 'best' solution is to have a dedicated farm for the canola and just piling it up. You can even have a large storage filled by it and pause the farm, then unpause when the storage gives you an alert that it's below 25%.
The only other way to do it is to go cooking oil->diesel , and sugar->ethanol->biodiesel. The diesel can then be burned or cracked to other petroleum products.
Also, meat/eggs, bread and snacks can be made into food packs for trade.
OP, you could also crack the resulting Diesel into other products and get some use out of those?
I don't remember whether Canola goes on Flat or on U-Shaped, but you can just rotate Canola with a crop that goes on the other Belt type, so that even if Canola clogs up, the Farm can still output the other one.
Or... based on the assumption that Canola goes on Flat, do a Canola, Corn, Vegetables, Corn rotation. Then only a little time is spent making Canola, and I've never maxed out on Vegetables after the early mid game. Should you need more Canola later, just replace the Vegetables with more Canola.
I think you should only need like 1 canola/veg farm per about 5,000 pop, if you provide all food types.
Once you have good industry going you can easily counter loss of fertility with fertilizers.
But your point is quite true.
I myself would pair canola with fruit, as later on it has use as both directly and in cakes which also use cooking oil and sugar, meaning combined production with canola and sugarcane works well.