5-hydroxymethylfurfural (HMF) is a platform chemical that can be converted into a wide range of high-value derivatives. Industrially, HMF-based derivatives are synthesized via chemical catalysis. However, biocatalytic transformation has emerged as an attractive alternative. Significant advances have been made in the last years using isolated enzymes and whole-cell biocatalysts in HMF biotransformation. Nonetheless, one of the major bottlenecks is the cost of the process, mainly due to the microorganism growth substrate. In this work, biotransformation studies to transform HMF into 2,5-di(hydroxymethyl)furan (DHMF) were carried out with the fungus Fusarium striatum using low-cost protein hydrolysates. The protein hydrolysates were obtained from fines, an unexploited material produced during the rendering process of meat industry waste residues. Given the high content in the protein of fines, of around 46%, protein hydrolysis was optimized using two commercially available proteases, Alcalase 2.4 L and Neutrase 0.8 L. The maximum degree of hydrolysis (DH) achieved with Alcalase 2.4 L was 21.4% under optimal conditions of 5% E/S ratio, pH 8, 55 °C, and 24 h. On the other hand, Neutrase 0.8 L exhibited lower efficiency, and therefore, lower protein recovery. After optimization of the Neutrase 0.8 L process using the response surface methodology (RSM), the maximum DH achieved was 7.2% with the variables set at 15% E/S ratio, initial pH 8, 40 °C, and 10.5 h. Using these hydrolysates as a nitrogen source allowed higher sporulation of the fungus and, therefore, the use of a lower volume of inoculum (three-fold), obtaining a DHMF yield > 90%, 50% higher than the yield obtained when using commercial peptones. The presented process allows the transformation of animal co- and by-products into low-cost nitrogen sources, which greatly impacts the industrial feasibility of HMF biotransformation.