The biofuels industry is heading towards a crossroads, with government policies shifting their timings and scope while the world continues to push towards carbon reduction.
Asia-Pacific’s (APAC’s) emerging economies will demand increasing amounts of energy, and it will need to come from both traditional fuels and biofuels. This rising demand and the opportunity to supply biofuels to markets such as Europe—which have been struggling with feedstock supplies and environmental hurdles—have made APAC the anticipated fastest-growing region in terms of production and demand for the sector.
In recent months, APAC government entities, airlines and companies have increased their efforts to utilise sustainable aviation fuel (SAF), with several initiatives across the region. Singapore now has a 1% SAF target by 2026 with a 3–5% target by 2030 and is bolstered by the significant Neste Singapore biofuels project, which produced just over 335m gal this year. Japan has a 10% target for international flights from Japan by 2030, and the Global Energy Infrastructure (GEI) database is tracking SAF projects such as the 99m gal/yr Wakayama SAF plant and the 66m gal/yr Idemitsu Kosan SAF plant in Shunan, both due online by 2028.
Indonesia has a 1% SAF mandate by 2027, with the proportion rising to 2.5% in 2030, and the Pertamina-led 91m gal/yr renewable diesel and SAF Cilacap green refinery is due for full startup in 2026, according to the GEI database. South Korea has a 1% mandate by 2027, with various biofuels projects due online in the next few years that include the LG-Enilive 95m gal/yr Daeson hydrotreated vegetable oil plant, due in 2027.
China introduced a 50,000t/yr SAF consumption target by 2025 in its 14th Five-Year Plan, but a specific mandate has yet to be announced. Despite this, state-controlled Sinopec began commercial SAF production in 2022, and the GEI database is tracking additional SAF projects in the country, including the 120m gal/yr Zhejiang Jiaao SAF plant, which has begun initial operations and has aspirations to double its output. Another notable project is the Tianzhou New Energy SAF plant, which is expected to produce 66m gal/yr as early as 2026 with a potential doubling of production in the future, but it is worth noting this project has been delayed previously due to the unclear government mandates.
Australia has no national biofuels mandate yet, but the government stated in September that it would invest $735m over ten years from 2028 for the development of a biofuels industry intended to push demand for feedstocks such as canola oil and sugarcane. GEI is watching several SAF and renewable diesel plants under consideration while waiting for policy clarity, such as the 30m gal/yr Project Ulysses SAF plant, due in 2028.
Waste opportunity
APAC countries could also have an advantage as the global market for biofuel feedstocks from waste continues to tighten. Second-generation biofuels (typically bioethanol) are made from biomass residues such as wheat straw, rice, corn cobs and bagasse that APAC countries have been focusing on in recent years. Both first- and second-generation ethanol can be blended with fossil fuels, and in October 2025, India joined the Belem 4x Initiative, which is a global pledge to quadruple the use of sustainable fuels by 2035. This seems to align with India’s ongoing plan to blend its ethanol production with gasoline, thus paving the way for the production from the existing and upcoming plants in the country.
APAC is already steadily supplying the European market with biofuels, and this is expected to continue and should increase if the feedstock supply remains suitable and if government policy does become more concrete across the region.
The EU is one of the largest biofuels markets in the world and its demand is pushed by strict environmental policies and a feedstock supply shortage. APAC’s growing government support and its access to versatile feedstock is creating a biofuels surplus opportunity to meet growing demand at home and abroad.
Thad Pittman is senior research analyst at Global Energy Infrastructure. To read Outlook 2026 in full, click here.
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