Argus European SAF assessments
Argus SAF (sustainable aviation fuel) assessments provide visibility into the true value of the fuel, with fair and reflective daily prices for this growing and increasingly important renewable fuel market.
Argus publishes a range of SAF prices for Europe:
- SAF fob ARA range
- SAF fob ARA less HBE-IXBs
- SAF cif NWE
What is SAF?
Carbon reduction mandates are being introduced globally and airlines looking to fulfill their environmental, social and corporate governance (ESG) requirements will need look to SAF to meet their needs.
There are 11 different approved ways for making SAF and 7 under evaluation. But the most commonly used today is HEFA SAF, or hydroprocessed esters and fatty acids. This process is also used to produce renewable diesel, hydrotreated vegetable oil (HVO), and little refinery change needs to be made to produce SAF out of HVO. HEFA SAF shares the same type of waste feedstocks used to make certain HVOs and can be blended up to 50% with fossil jet.
- Norway paved the way by requiring domestic sellers of aviation fuel to blend 0.5% of SAF from 2020. The target could increase to 30% by 2030.
- Sweden required a 0.8% GHG emission reduction in June 2021, while France introduced a 1% mandate starting in January 2022.
- The United Kingdom is aiming to introduce a GHG emissions reduction mandate starting in 2025, targeting at least a 10% SAF share by 2030.
- The EU earlier this year reached a provisional agreement on a SAF mandate to be introduced in 2025.
- Cap net CO2 emissions to 2019 levels, voluntary 2021-2027 and then mandatory.
The UN Icao's Corsia requires countries to oblige airlines to offset CO2 emissions exceeding relevant baselines. The Corsia baseline for 2021-2023 is set at 2019 CO2 emissions levels, while the baseline for 2024-2035 is defined as 85pc of 2019 CO2 emissions. Participation in Corsia is voluntary during the pilot phase and the first phase, from 2021-26. Compliance will be mandatory for all aircraft operators from 2027. Corsia aims to offset any CO2 emissions remaining after the use of Corsia-eligible fuels and technological and operational improvements.
The European Union’s proposal for an EU-wide blending SAF mandate
Advantages of the ARGUS SAF assessments
All Argus SAF assessments reflect real market activity and are based on market inputs gathered from a wide range of sources that participate in the physical market. The SAF assessments are also underpinned by robust HVO and renewable feedstocks assessments, with all four RED HVO Classes and RED used cooking oil (UCO) fob ARA range assessments trading in Argus’ proprietary trade initiation platform Argus Open Markets® (AOM).
Argus SAF fob ARA, with the option to exclude HBE tickets
Get the same robustness and transparency but with ability to use the SAF fob ARA assessment stripped of the credit prices for the Netherlands, where blending SAF can generate these tradable certificates, which are also assessed by Argus. The new index offers a relative view of prices excluding the value of the policy incentive, useful not only domestically but for comparison with international trade.