Daily Memo: SAF Initiatives Are Ramping Up Across Asia

While airlines are raising concerns about a global shortfall in supply of sustainable aviation fuel (SAF), several projects under development in Asia will boost the region’s SAF production capability.

The potential for Asia’s SAF industry is such that it could play a major role in helping provide for airline demand both inside and outside the region. There is already significant SAF production occurring in Asia, and many new facilities are either being constructed or are on the drawing board.

These developments are being spurred by planned government SAF mandates or targets in several Asian markets, such as India, Singapore, South Korea, Hong Kong, Japan and Indonesia. Others are considering such a step.

Many of the region’s airlines have set their own SAF goals, which in some cases go beyond proposed government mandates. In addition to individual targets, the members of the Association of Asia Pacific Airlines have collectively committed to 5% SAF usage by 2030.

CAPA has launched a database (https://centreforaviation.com/data/saf) that tracks SAF contracts and agreements signed globally. This database includes 54 agreements signed by Asia-Pacific airlines, mainly SAF offtake deals, and 33 agreements involving SAF production projects in that region, covering investment, funding and development. Some airlines and projects account for multiple contracts.

A study released by Boeing in September 2024 determined that Southeast Asia has enormous potential for providing SAF feedstock. It estimated that Southeast Asia has enough feedstock availability to provide 12% of the global demand for SAF in 2050. About 75% of this would come from agricultural and post-consumer waste.

In comparison, Southeast Asia currently accounts for about 8% of jet fuel demand, so the region could be a net exporter.

Neste, one of the SAF industry’s leading players, operates a large refinery in Singapore.

Hong Kong-based EcoCeres is another big SAF producer with expansion plans. It already has a production facility in Jiangsu Province in mainland China, and intends to open another refinery in Johor, Malaysia, in the second half of 2025.

Another project is also planned in Johor. Malaysian energy company PETRONAS has formed a joint venture with Japan’s Euglena and Italy’s Enilive to build a biorefinery there. The construction contract was awarded in December 2024, and the partners intend to open it in 2028.

There has been significant SAF activity in mainland China. Energy giant Sinopec produces SAF at its Zhenhai plant, and it has plans in place to develop more facilities at its refineries. One such project is in conjunction with France-based TotalEnergies.

Another Chinese SAF production facility was completed in 2024 by Henan Junheng Industrial Group Biotechnology Co. in Henan Province. Many other SAF initiatives are under development elsewhere in China.

In South Korea, SK Energy began production of SAF at one of its refineries in October 2024. The company has already exported SAF to Europe.

One of the next major SAF facilities to come online in Asia will likely be in Thailand.

The country’s Bangchak energy conglomerate says it completed 96% of the construction of a new SAF plant near Bangkok by early April and intends to begin operations in the second quarter.

Bangchak says it has already signed purchase agreements with customers.

PTT Global Chemical began producing SAF in Thailand in January, and the company plans to expand its production capability.

The International Finance Corporation (IFC) and the Asian Development Bank are helping fund a SAF production initiative in Pakistan, which IFC says will be among the first large-scale facilities in South Asia.

SAFCO Ventures intends to establish the plant in Sheikhupura, Punjab.

Government incentives and aviation industry support are very helpful for the SAF industry in Asia. For governments, raising SAF production will help support their plans for usage requirements, and represents a plank in their green agendas.

SAF also presents Asian countries with a strategic opportunity to establish a new and potentially lucrative industry, particularly for those with abundant agricultural waste suitable for feedstock.