The Asian SAF industry faces threefold challenges

The Asian aviation sector is intensifying efforts to scale up Sustainable Aviation Fuel (SAF) production capacity. However, during the ‘Asian SAF Innovation’ panel discussion at the 2025 Asia-Pacific Petroleum Conference (APPEC) held in Singapore on 10 September, panellists cautioned that fragmented policy support, infrastructure gaps and rising feedstock costs could constrain SAF industry growth in the coming years.

The call for coordinated action was a central theme. Gabriel Ho, Founder and Chief Sustainability Officer of the Asian Sustainable Fuels Association, urged Asian nations to develop tailored roadmaps with regional coordination to propel the continent into a global SAF hub. 'Asia possesses immense potential, but policies must shift from reactive measures to proactive planning," Ho stated. "Only by forming biofuel industrial clusters with economies of scale can technology, capital and talent naturally achieve large-scale aggregation.'

Currently, Singapore is seen as a policy benchmark in Asia, with its passenger fuel surcharge providing predictable demand signals. Other nations, including India, Malaysia, Indonesia, and South Korea, are expected to introduce mandatory SAF blending quotas from 2027. However, Natasha Yang, SAF Supply Assurance Manager at Cathay Pacific, highlighted a critical gap: most Asian markets lack post-2030 SAF blending targets. Noting Europe's clear pathway to 2040, Yang emphasized that Asia requires similar long-term clarity to de-risk investments.

Infrastructure and supply chain issues were identified as primary barriers. Panelists pointed to Asia's abundant agricultural waste as a potential resource, but cited traceability and engaging smallholder farmers as key challenges. 'Certification systems and industry education are paramount,' Yang explained. 'Only through these can we ensure raw materials meet verification standards... thereby realising commercial value.'

Logistics also present a significant bottleneck. Yang noted the region's lack of comprehensive pipeline, barge, and rail networks compared to Europe and North America. 'Without increased investment to relocate production facilities... rising logistics costs will erode SAF's market competitiveness,' she warned.

On the technology front, Hydrogenated Esters and Fatty Acids (HEFA) remains the dominant SAF production pathway in Asia, though Alcohol-to-Jet (ATJ) and e-fuels are gaining traction. New production facilities are planned for China, Malaysia, and Thailand, with Japan advancing pilot projects for 2027-2029.

Gabriel Ho suggested that the future lies beyond HEFA. "The next wave of industry transformation will focus on integrating biofuels with renewable energy," he said, indicating that producing SAF from synthetic gas combined with green hydrogen may be Asia's long-term trajectory. The high cost of all alternatives remains a formidable barrier. According to Platts data from September 10, the Asian SAF price premium over conventional jet fuel was $1,300.90 per tonne, with eSAF potentially exceeding $8,000 per tonne.

Panelists concurred that accelerating policy, infrastructure, and financing systems is imperative. Ho issued a final warning: "This decade is critical. Without clear incentive policies and mandatory quota frameworks, Asia risks missing the opportunity to lead the global SAF market."