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The report highlights a market that is rapidly shifting from voluntary adoption toward compliance-driven demand, led by the implementation of the EU’s ReFuelEU Aviation regulation and the UK SAF mandate.
Global SAF supply doubled to around 2 million tonnes in 2025 from 1 million tonnes in 2024, while demand is projected to reach 3 million tonnes in 2026.
Despite the strong growth outlook, SkyNRG warned that the industry remains heavily dependent on hydroprocessed esters and fatty acids (HEFA) technology and faces a growing need to diversify into alternative pathways, including alcohol-to-jet (AtJ), Fischer-Tropsch (FT) and synthetic SAF (eSAF).
The 2030 demand forecast was revised down from 15.5 million tonnes in the 2025 edition of the outlook to 12.8 million tonnes this year, equivalent to 3.6% of global jet fuel demand rather than the previously forecast 4.5%.
The downgrade was primarily attributed to weaker near-term SAF economics in the US following changes to federal biofuel support mechanisms.
Even so, SkyNRG said confidence in demand growth outside the US has improved, particularly in Asia, where countries including Indonesia, South Korea, India and Singapore have moved from SAF roadmaps toward more concrete policy frameworks.
Mandates already in force are expected to account for around 5 million tonnes of SAF demand by 2030, while another 3 million tonnes could come from countries expected to implement mandates later this decade. A further 5 million tonnes is projected to come from voluntary markets and policy-supported demand.
The report noted that around 60 airlines have committed to using at least 10% SAF by 2030, representing approximately 13 million tonnes of potential voluntary demand.
Europe is expected to remain the world’s largest compliance-driven SAF market through ReFuelEU Aviation and the UK mandate. SkyNRG forecasts EU SAF demand will reach 3 million tonnes by 2030 when the bloc’s blending requirement rises to 6%, before increasing to 10.3 million tonnes by 2035 and 38 million tonnes by 2050.
The report also highlighted the growing role of synthetic aviation fuels. Under ReFuelEU, the dedicated eSAF sub-mandate begins in 2030 with a 1.2% requirement, equivalent to approximately 0.6 million tonnes of eSAF demand. This rises to 2.6 million tonnes by 2035 and 19 million tonnes by 2050.
In the UK, SAF accounted for around 2.5% of jet fuel uplift in 2025, with the mandate increasing to 3.6% in 2026. By 2030, total UK SAF demand is expected to reach 1.2 million tonnes, of which no more than 0.9 million tonnes can be supplied by HEFA due to the UK’s cap on the pathway.
These developments reflect a broader trend that market sources have increasingly highlighted recently – while HEFA remains the dominant production route, growing competition for waste lipids such as used cooking oil (UCO), animal fats and palm oil mill effluent (POME) is prompting greater interest in non-lipid pathways, particularly eSAF and advanced biofuels.
We recognize that understanding both feedstock market dynamics and the wider energy transition landscape is essential for developing effective procurement strategies, managing risks and maximizing profits. Fastmarkets’ SAF price assessments provide airlines, aviation industry traders and finance managers with the clarity they need.
On paper, global SAF production capacity is forecast to reach 18.5 million tonnes by 2030, up slightly from the 18.1 million tonnes projected in last year’s outlook. Capacity is expected to increase further to 19 million tonnes by 2035.
But SkyNRG cautioned that the market may experience temporary overcapacity before 2030 because demand growth has been revised lower while capacity projections have remained broadly unchanged. This could weaken SAF price signals, pressure producer margins and delay final investment decisions (FIDs).
The report found that approximately one-third of tracked SAF projects have already been delayed by at least one year compared with last year’s outlook, with advanced pathways disproportionately affected.
Beyond 2030, however, the picture changes significantly. Under SkyNRG’s central scenario, SAF demand is expected to nearly triple from 12.8 million tonnes in 2030 to around 47 million tonnes by 2035, creating a substantial supply gap if new projects do not reach commercial operation.
A key finding of the report is the continued dominance of HEFA technology.
HEFA accounts for approximately 85% of expected global SAF capacity in 2030, with most newly announced projects over the past year linked to HEFA production or refinery co-processing. Co-processing alone has doubled its share of projected 2030 capacity from around 2% in 2024 to 4% in the latest outlook.
SkyNRG warned that this dependence creates structural risks because HEFA relies on feedstocks that are already facing growing competition from renewable diesel and other sectors.
The report maintains that the industry’s “HEFA tipping point” is still expected around 2030, after which feedstock constraints become increasingly significant.
This mirrors concerns frequently raised by market participants, who have increasingly pointed to tightening availability of waste-based feedstocks and rising costs as reasons for growing interest in alternative pathways.
Meanwhile, the report paints a mixed picture for next-generation SAF technologies.
Alcohol-to-jet capacity expectations were revised down by around 1.3 million tonnes for 2030, despite the successful startup of LanzaJet’s Freedom Pines facility in the US. SkyNRG attributed the downgrade to weaker US SAF incentives and increasing competition for ethanol from road transport fuels.
Bio-FT showed modest improvement, with expected capacity increasing to around 0.8 million tonnes by 2030, supported by projects using biomass gasification and renewable natural gas.
Meanwhile, eSAF recorded the strongest growth among advanced pathways. Global eSAF capacity expectations increased by approximately 0.8 million tonnes compared with last year’s outlook. But only around 0.2 million tonnes of eSAF is currently expected to be operational by 2030, well below future European demand requirements.
The report noted that Europe is likely to rely on imported eSAF volumes during the early years of its synthetic fuel mandate, while China is emerging as a major competitor due to faster project development, streamlined permitting and coordinated industrial policy.
One of the most notable regional shifts identified in the report is Asia’s emergence as the largest source of announced SAF production capacity, overtaking the US.
China is playing a central role in that expansion through rapid project development across both HEFA and emerging pathways. At the same time, countries including Indonesia and Malaysia are increasingly prioritizing domestic refining over feedstock exports, introducing or considering restrictions on UCO and POME exports.
SkyNRG warned that these policies could significantly reshape future feedstock trade flows, particularly for Europe, which remains heavily dependent on imported waste oils.
The report noted that around 70% of UCO used in EU biofuel production in 2022 came from imported feedstocks, while 68% of net UCO imports into the EU and UK originated from China, Malaysia and Indonesia. Even in 2025, those three countries still accounted for 57% of net UCO imports.
According to the report, Europe’s projected HEFA and co-processing capacity of 3.9 million tonnes by 2035 exceeds the region’s domestic feedstock potential of around 2 million tonnes annually, increasing exposure to trade restrictions and feedstock competition.
A new theme running throughout the 2026 outlook is energy security. SkyNRG argued that recent geopolitical disruptions, including concerns around the Strait of Hormuz, have elevated SAF’s strategic importance beyond aviation decarbonization.
The company said regions such as Europe, Asia and Oceania remain particularly exposed to crude oil and jet fuel imports and could use SAF production to improve fuel resilience by developing domestic supply chains.
The report concluded that while SAF can strengthen energy security, long-term resilience will require diversification beyond HEFA.
“Without diversification beyond HEFA, the sector risks trading one energy dependence for another,” SkyNRG said, warning that advanced biofuels and eSAF will be needed to avoid a post-2030 supply shortfall and support continued growth in SAF demand.