I use only food derived colors in my soaps.(trying to avoid allergens) I put about 2 tablespoons of paprika and 6 oz Olive Oil(pomace) into a jar with a lid(I reuse pickle jars, yeast jars, maraschino cherries jars, etc) and put them into a pot with enough water to come halfway up the jar. Bring to a boil and reduce to a simmer for about half an hour or so. Let it cool and you can pour off the oil without disturbing the paprika in the bottom. I pour into a coffee filter to squeeze it to get the last of the oil out.
I substitute some of the colored oil for the olive oil in the recipe. How dark you want it determines how much you use. Usually not more than 1 oz/16oz oils batch. This covers up all the yellowing I get from milks.
When I made goat's milk, I was very afraid of color issues, so I used 2-3 oz, and used cinnamon, clove, nutmeg EO's to make it seem like it was all intentional. It looks like spice cake. Next time I may put some uncolored soap on top to look like frosting and put it in my petite loaf pan.