Aviation Biofuels Market: Market Size & Forecast 2026

Aviation biofuels are liquid fuels derived from biomass or waste feedstocks that can be blended with or substitute for conventional Jet A/A-1 kerosene in commercial and military aircraft. The global market sits at roughly $1.6 billion in 2025 and is projected to expand at a compound annual growth rate of about 35%, reflecting a shift from niche, demonstration-scale output to commercial-scale production. Most approved pathways today are Hydroprocessed Esters and Fatty Acids (HEFA), with Fischer-Tropsch (FT), Alcohol-to-Jet (ATJ), and co-processing gaining momentum in parallel.

• •Global market size estimated at approximately $1.6 billion in 2025.
• •Compound annual growth rate forecast near 35% over the coming decade.
• •HEFA is currently the dominant certified conversion pathway.

The primary growth engine is the aviation industry's commitment to net-zero carbon emissions by 2050, codified through CORSIA and reinforced by national blending mandates in the European Union, the United Kingdom, and the United States. Corporate sustainability programmes and the rapid growth of voluntary carbon markets have created long-term offtake commitments that underpin financing for new biorefineries. At the same time, the volatility and long-term price of fossil jet fuel is making biofuel blends more economically attractive, especially at higher blending ratios.

• •Mandatory blending requirements in the EU, UK, and US are creating guaranteed baseline demand.
• •Long-term offtake agreements from airlines and corporates are financing refinery build-outs.
• •Fossil jet fuel price volatility is improving the relative economics of SAF blends.

The market can be segmented by fuel type (biofuels, hydrogen, Power-to-Liquid), by conversion pathway (HEFA, FT, ATJ, co-processing), by blending ratio (below 30%, 30-50%, above 50%), and by aircraft platform. Geographically, North America and Europe together account for the majority of production capacity and demand because of supportive policy frameworks, established feedstock supply chains, and the presence of major airlines and refiners. Asia-Pacific is the fastest-growing region, led by large-scale projects in Singapore, Japan, China, and India, supported by government-backed aviation decarbonisation roadmaps.

• •HEFA dominates current output; ATJ and FT pathways are scaling rapidly.
• •North America and Europe lead on capacity, policy, and demand today.
• •Asia-Pacific is the fastest-growing regional market for new production.

What are the recent trends and outlook?

Looking ahead, the market is expected to move decisively from HEFA dominance toward a more diversified mix of pathways, including alcohol-to-jet, Power-to-Liquid synthetic fuels, and fuels made from agricultural residues, algae, and municipal solid waste. Capacity announcements published in 2025 and early 2026 suggest that global SAF output could rise several-fold before the end of the decade if all announced projects reach completion, although feedstock availability and cost remain key risks. CORSIA compliance, national blending mandates, and growing passenger willingness to pay a small premium for lower-carbon flights are expected to sustain double-digit annual growth well beyond 2030.

• •Feedstocks are diversifying from used cooking oil toward alcohols, residues, and synthetic e-fuels.
• •Project pipelines indicate a multi-fold increase in global SAF capacity by 2030.
• •CORSIA and national mandates will keep annual growth above 25-30% through the next decade.