Aviation Biofuel Market

Increasing Need for Reduction In GHG Emissions In The Aviation Industry Boosts Market Growth

Aviation biofuel is introduced as a substitute for conventional petroleum fuels. Fossil fuels produce greenhouse gases when burnt, and these gases trap sunlight in the atmosphere, thereby heating the planet. The use of biofuel is encouraged in many countries to reduce the generation of greenhouse gases, which helps to grow the market CAGR. Moreover, biofuel use has higher cost-effectiveness than conventional fossil fuels. Biofuels are adaptable to the engine, keeping it running longer and reducing maintenance costs. The aviation industry is committed to decoupling carbon emissions from traffic growth increases.

SAF gives an impressive reduction of up to 80% in the head of CO2 emissions over the fuel lifecycle compared to fossil jet fuel. This depends on the sustainable feedstock used and other factors like production methods and the supply chain analysis to the airport. According to the information circulated by the IATA fact sheet, SAF will be a suitable option for aircraft operators to meet their obligations under the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA).

Implementing stringent regulations to maintain standards in aviation fuel production may hinder the market's growth; however, it can be overcome with innovation and technological advancements in the upcoming years.

The Global Aviation Biofuel Market Industry is poised for substantial growth, with projections indicating a market size of 44.1 USD Billion in 2024 and an anticipated increase to 80.9 USD Billion by 2035. This growth trajectory reflects the increasing adoption of biofuels in the aviation sector, driven by regulatory support, technological advancements, and rising consumer demand for sustainable practices. The compound annual growth rate of 5.67% from 2025 to 2035 further underscores the market's potential. As stakeholders continue to invest in biofuel technologies and collaborate on sustainability initiatives, the industry is likely to witness significant advancements and increased market penetration.

Collaboration among various stakeholders is becoming increasingly vital in the Global Aviation Biofuel Market Industry. Partnerships between airlines, biofuel producers, and government entities are fostering innovation and facilitating the commercialization of biofuels. For instance, initiatives such as the Sustainable Aviation Fuel Users Group are bringing together key players to share knowledge and resources. This collaborative approach is likely to enhance the development of biofuels, ensuring that they meet the necessary sustainability criteria. Such synergies are expected to contribute to the market's expansion, as stakeholders work collectively towards a common goal of reducing aviation emissions.

Investment in renewable energy sources is a significant driver for the Global Aviation Biofuel Market Industry. Governments and private sectors are channeling substantial funds into the development of sustainable aviation fuels. For example, the U.S. Department of Energy has allocated millions to support research initiatives aimed at advancing biofuel technologies. This influx of capital not only accelerates innovation but also enhances the scalability of biofuel production. As the industry matures, the increased investment is expected to facilitate the transition towards a more sustainable aviation sector, further solidifying the market's growth trajectory.

The Global Aviation Biofuel Market Industry is experiencing a surge in regulatory support and favorable policy frameworks aimed at reducing greenhouse gas emissions. Governments worldwide are implementing stringent regulations that mandate the use of sustainable aviation fuels. For instance, the European Union's Green Deal and the U.S. Sustainable Aviation Fuel Grand Challenge are pivotal in promoting biofuel adoption. These initiatives not only encourage investment in biofuel technologies but also create a conducive environment for research and development. As a result, the market is projected to reach 44.1 USD Billion in 2024, reflecting the impact of these supportive measures on the industry's growth.

Technological advancements play a crucial role in the Global Aviation Biofuel Market Industry, enhancing the efficiency and cost-effectiveness of biofuel production. Innovations such as improved feedstock conversion processes and the development of advanced biofuels from non-food sources are gaining traction. For example, the use of algae and waste oils as feedstocks is becoming more prevalent, leading to higher yields and lower production costs. These advancements are expected to drive market growth, with projections indicating a market size of 80.9 USD Billion by 2035. The continuous evolution of technology in biofuel production is likely to bolster the industry's competitiveness and sustainability.

The Global Aviation Biofuel Market Industry is witnessing a growing demand for sustainable aviation practices, driven by both consumers and airlines. Airlines are increasingly committing to carbon neutrality and sustainability goals, which necessitate the adoption of biofuels. For instance, major airlines have set ambitious targets to reduce their carbon footprint, thereby creating a robust market for aviation biofuels. This shift in consumer preference towards environmentally friendly travel options is likely to propel the market forward. The anticipated compound annual growth rate of 5.67% from 2025 to 2035 underscores the potential for biofuels to play a pivotal role in achieving these sustainability objectives.

By Region, the study provides market insights into North America, Europe, Asia-Pacific, and the Rest of the World. North American aviation biofuel will dominate this market. Because the Aviation Bio-fuel Market is home to sustainable aviation fuels that are emerging as a component in meeting the aviation industry, growing environmental concerns will boost the market growth in this Region.

Further, the major countries studied in the market report are The U.S., Canada, German, France, the UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil.

Figure2 AVIATION BIOFUEL SHARE BY REGION 2022 (%)

Source Secondary Research, Primary Research, Market Research Future Database, and Analyst Review

Europe's Aviation Biofuel market accounts for the second-largest market share due to the rise in supportive policies and initiatives for decarbonizing aviation emissions. Further, the German Aviation Biofuel market held the largest market share, and the UK Aviation Biofuel market was the fastest-growing market in the European Region.

The Asia-Pacific Aviation Biofuel Market is expected to grow at the fastest CAGR from 2023 to 2030. This is because Asia-Pacific countries are the major supply hubs for raw materials such as crops to produce aviation biofuels. Moreover, China’s Aviation Biofuel market held the largest market share, and the Indian Aviation Biofuel market was the fastest-growing market in the Asia-Pacific region.

Leading market players are investing heavily in research and development to expand their product lines, which will help the Aviation Biofuel market grow even more. Market participants are also undertaking various strategic activities to expand their  footprint, with important market developments including new product launches, contractual agreements, mergers and acquisitions, higher investments, and collaboration with other organizations. The aviation biofuel industry must offer cost-effective items to expand and survive in a more competitive and rising market climate.

Manufacturing locally to minimize operational costs is one of the key business tactics manufacturers use in the Aviation biofuel industry to benefit clients and increase the market sector. The Aviation Biofuel industry has offered some of the most significant advantages to growing environmental concerns in recent years. Major players in the Aviation Biofuel market, including Neste (Finland), Gevo (US), World Energy (US), Eni (Italy), Aemetis, Inc. (US), SkyNRG (Netherlands), Velocys (UK), Fulcrum BioEnergy (US)., and others, are attempting to increase market demand by investing in research and development operations.

Johnson Matthey is a British multinational specialty chemicals and sustainable technologies company headquartered in London, England. Specialties Johnson Matthey offers catalysis, precious metals, fine chemicals, process technology, sustainability, chemistry, chemicals, pgms, chemical processes, fuel cells, emissions control, automotive, refining, electrochemistry, chemical synthesis, material science, process engineering, product formulation, material characterization, specialist metallurgy, hydrogen, syngas, surface chemistry, chemical synthesis, and sustainable aviation fuel. Johnson Matthey launched an innovative technology, HyCOgenTM, by converting captured carbon dioxide (CO2) and green hydrogen into sustainable aviation fuel (SAF) using FT technology.

Boeing is the world's largest aerospace company and leading provider of commercial airplanes, defense, space and security systems, and services. Building on a legacy of aerospace leadership, Boeing continues to lead in technology and innovation, deliver for its customers, and invest in its people and future growth. Boeing announced a supply agreement for two million gallons of blended renewable aviation fuel with EPIC Fuels to power its commercial operations in Washington state and South Carolina by the end of 2022.