Global SAF supply to fall 23 million mt short of demand by 2035: SkyNRG

Global sustainable aviation fuel supply is projected to reach 18.1 million mt by 2035, falling short of forecasted demand by more than 23 million mt, according to SkyNRG's annual Sustainable Aviation Fuel Market Outlook, released on June 5 in collaboration with ICF.

The report paints a stark picture of the challenges ahead as the aviation industry intensifies efforts to decarbonize.

While SAF production doubled in 2024 to reach around 1 million mt, driven by growing mandates and corporate commitments, the gap between supply and demand is expected to widen dramatically by the mid-2030s.

By 2030, global SAF demand is forecasted to exceed 15 million mt, then nearly triple to 40 million mt by 2035 — largely driven by accelerated policy mandates and voluntary airline targets.

With current SAF production capacity expected to reach only 18 million mt by 2035, the industry faces a 26 million mt shortfall that must be closed within just five years.

New capacity, pathways needed

Co-processing and renewable diesel technologies could contribute an additional 6 million mt of fuel by then, but the majority of this deficit will require new production capacity and investment in alternative pathways.

"While the momentum behind SAF is real and growing, our latest analysis shows we are reaching a HEFA tipping point," said Maarten van Dijk, CEO and co-founder of SkyNRG, referring to Hydroprocessed Esters and Fatty Acids, the most widely used SAF production technology. "Over 80% of current SAF capacity relies on HEFA, which is constrained by feedstock availability. To meet future targets, the industry must pivot to more diverse technologies and feedstock sources."

Developed with support from aviation consultancy ICF, the 2025 outlook warns that without rapid diversification of production methods, the global SAF market could face serious bottlenecks.

Technologies such as Alcohol-to-Jet, Gasification-Fischer Tropsch, and Power-to-Liquid will need to be scaled urgently to meet long-term climate goals.

Dan Galpin, global aviation lead at ICF, emphasized that the report comes at a turning point for the industry.

"With mandates now in place in the EU and UK, and more ambitious frameworks on the horizon, we're entering a new phase," he said. "Hundreds of SAF projects have been announced globally, but realizing their potential will depend on coordinated policy, infrastructure readiness, and investor confidence."

The start of 2025 marked a milestone with the implementation of SAF blending mandates in Europe and the UK. In parallel, more than 60 airlines have set specific SAF targets for 2030, highlighting SAF's growing importance as the aviation industry's primary decarbonization lever.

Targeted policy support

SkyNRG's report extends its outlook to 2050, stressing the need for robust and targeted policy support to sustain growth.

This includes financial instruments for offtakers, incentives for technology developers, and investments in feedstock logistics and refining infrastructure.

"The challenge is massive," van Dijk said, "but so are the rewards. SAF can transform the future of flying, and this report offers a clear roadmap of what's needed to get there."

SkyNRG and ICF say they hope the report will guide corporate and investor strategies and contribute to broader public understanding and support for a clean aviation transition.

Currently, about 82% of SAF production capacity depends on HEFA technology. SkyNRG CEO Maarten van Dijk described this as reaching a "HEFA tipping point," emphasizing the urgent need for the industry to diversify into other technologies and feedstock sources to meet future demand.

Alternative pathways must be scaled rapidly to avoid bottlenecks and ensure sustainable growth.

The report notes that while co-processing and renewable diesel technologies could add around 6 million mt of SAF by 2035, the majority of the supply gap will require new production capacity and significant investment in alternative technologies.

Without coordinated policy support, infrastructure readiness, and investor confidence, the SAF market risks stagnation and continued reliance on unsustainable feedstocks.

Regional dynamics also play a role. The EU and UK have launched SAF blending mandates that are expected to drive demand to 4 million mt by 2030 and 12 million mt by 2035, requiring a steep ramp-up in capacity. Asia, led by China, is expected to increase SAF demand to nearly 11 million mt by 2035, with capacity currently outpacing demand, positioning the region as a potential exporter. The US aims for 9.1 million mt of SAF production by 2030 under federal policies, though uncertainties remain around long-term incentives.

The report extends its outlook to 2050, stressing the necessity of robust and targeted policy frameworks, including financial incentives for offtakers and technology developers, and investments in feedstock logistics and refining infrastructure. SkyNRG and ICF highlight that meeting these challenges offers strategic opportunities to enhance energy security, support rural economies, and accelerate renewable energy development.

Platts, part of S&P Global Commodity Insights, assessed the renewable diesel-A outright price at $1,951.25/mt on June 4, 1.68%, or $32.25/mt, higher week over week. The RD-B outright price was assessed at $1,938.50/mt, also 1.69% higher week over week, resulting in a $12.75/mt spread between RD-A and RD-B.

Platts assessed the Asia SAF-jet fuel spread at $1,129.81/mt June 5, up $8.99/mt day over day.