Factory farming is the intensive raising of animals for eggs and/or meat. Biodiesel can be made from animal fat. As an example 50 litres of fat will typically come from a cow, it is a by-product of meat consumption. Fuel will never be an economic driver for raising animals, the amount of fat from an animal does not justify raising an animal to make biodiesel. It is a by-product.

In general, in the western world:

	Pigs are kept in tiny concrete pens for their whole life. Sows are kept pregnant and pinned down to the concrete floor so they don't roll on the piglets in the tiny stalls.
Chickens are kept in sheds, raised in 6 weeks and slaughtered. Hens are also kept in 'battery sheds' where they are kept in a cage that maybe allows enough room to turn around if they are lucky. They are kept there until they are to old to lay eggs then slaughtered. The use of lights at night effectively makes 2 days in one, so the chickens lay 2 eggs per normal day, that's why the shells are so thin.
	Cows and Sheep vary country to country, they are generally kept in paddocks. Feedlots are increasingly being used to keep the cows and sheep in for their whole life or the last few months of their lives. This practice is used to fatten animals up with high protein feeds. Feedlots are small pens full of animals who are fed meal from grains.

Factory Farming website - Information and pictures.

The Meatrix - Animated look at what happened to traditional farms like we see on packaging and what is happening now.

The Humane Society - Information on factory farming.