A waste lipid can usually become more than one fuel, and the classification decides more about its value than the chemistry does. Used cooking oil, animal fat, POME and acid oils all feed the same two processing routes, hydrotreatment (HVO, and via the same units SAF) and esterification (FAME), but they do not carry the same regulatory weight. Annex IX Part A materials get dedicated quotas; Part B sits under a national cap; food and feed crops sit outside both and under their own limit. Two cargoes with an identical fatty acid profile can therefore be worth very different amounts, and the cheapest way to lose money in this market is to assume the chemistry settles it.
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We never take title, so the contract is always between you and the counterparty.
There are two processing routes, and they take different material
Almost everything below runs through one of two conversions, and knowing which one a buyer operates tells you most of what they will screen on.
- Hydrotreatment produces HVO (renewable diesel), and the same units with a different cut produce SAF on the HEFA route and bionaphtha as a co-product. It handles a wide range of fats and oils, but the catalyst is unforgiving: phosphorus, metals and chlorine are what fail a cargo here.
- Esterification produces FAME (biodiesel), named after its input, UCOME from used cooking oil, RME from rapeseed, TME from tallow, SME from soy. It tolerates higher free fatty acid content than hydrotreatment does, which is why acid oils and lower grades find a home here.
That difference is why the same tonne can be attractive to one plant and worthless to another, without anything being wrong with it.
The routes, per material
The classification column is the one that moves money. A material that qualifies under Annex IX Part A can fill a quota that Part B cannot, and neither can be filled by a crop-based oil. See Annex IX feedstocks for the lists themselves.
| Used cooking oil (UCO) | HVO, SAF, FAME (UCOME), oleochemicals | Annex IX Part B | Part B sits under a national cap, so the value moves with how full that cap is |
|---|---|---|---|
| Animal fat, category 3 | HVO, SAF, FAME (TME), oleochemicals, feed and pet food | Annex IX Part B | Contested between four industries; feed and pet food bid against fuel |
| Animal fat, category 1 and 2 | HVO, FAME, technical uses | Annex IX Part B | Feed and food routes are closed by the animal by-product rules |
| POME (palm oil mill effluent) | HVO, SAF | Annex IX Part A | Part A carries dedicated quotas, and with them the sharpest scrutiny on origin |
| Acid oils and soapstock | FAME, oleochemicals | Depends on origin | High free fatty acid content generally rules out the hydrotreatment route |
| Crude tall oil (CTO) | HVO, bionaphtha, oleochemicals | Annex IX Part A as a processing residue | The oleochemical industry competes hard for the same volume |
| Vegetable oils (rape, soy, palm, sunflower) | FAME (RME, SME), HVO | Not Annex IX, food and feed crop | Sits under the crop cap, so it cannot fill an advanced quota |
| Plastic pyrolysis oil (PPO) | Steam cracker feed, bionaphtha | Recycled carbon fuel, not Annex IX | Chlorine and silicon; the cracker route needs ISCC PLUS mass balance |
| Tyre pyrolysis oil (TPO) | Carbon black feedstock, industrial and marine fuel blending, refinery upgrading | Split: biogenic share as Annex IX Part A, fossil share as recycled carbon fuel | Aromaticity and sulphur close the steam cracker door and open the carbon black one |
Why SAF is not simply HVO with a different label
The HEFA route to aviation fuel runs through the same hydrotreatment step, which is why the two products keep appearing together. But the specification and the obligation behind them are different, and so is the competition for the molecule.
ReFuelEU sets a rising blending obligation for aviation with a separate sub-mandate for synthetic fuel that HEFA cannot fill, that gap is the commercial ground under eSAF. For a feedstock seller the practical consequence is that aviation and road transport are bidding for the same hydrotreated molecules under different rules, and which of them pays more moves with policy rather than with chemistry.
The question behind almost every enquiry
Measured over our own incoming mail, the great majority of questions about HVO and SAF are not about who buys the product. They are about the feedstock: which one, what it qualifies as, and what certification comes with it. The three that follow are the ones worth settling before anything else.
- What is it, exactly, and where did it come from? The origin decides the classification, and the classification decides the value.
- What does the certificate cover? Not the certificate number, the annex. See ISCC certificate scope; a scope that does not match your counterparty's ends the trade regardless of quality.
- What is the greenhouse gas saving, and who calculated it? Two identical cargoes with different transport legs are not worth the same.
Frequently asked questions
Can used cooking oil become SAF?
Yes, through the HEFA route, the same hydrotreatment that produces HVO, with a different cut. UCO also goes to FAME as UCOME and into oleochemicals. It is classified under Annex IX Part B, which sits under a national cap, so its value moves with how full that cap is rather than with the chemistry alone.
What is the difference between HVO and FAME as an outlet for my material?
They are different conversions with different tolerances. Hydrotreatment produces HVO and, with a different cut, SAF and bionaphtha; its catalyst is unforgiving on phosphorus, metals and chlorine. Esterification produces FAME and tolerates a much higher free fatty acid content, which is why acid oils and lower grades find a home there and not in a hydrotreater.
Can POME go to aviation fuel?
Yes, POME feeds both HVO and SAF through hydrotreatment. It is classified under Annex IX Part A, which carries dedicated quotas, and with them the sharpest scrutiny on origin documentation of any feedstock in this market. Expect the traceability questions to be harder than the specification questions.
Why is my rapeseed oil worth less than used cooking oil for biofuel?
Because it is not a waste. Crop-based oils sit outside Annex IX and under the crop cap, so they cannot fill an advanced quota that a waste feedstock can. That is a regulatory difference, not a quality one, and it is the clearest example in this market of classification deciding value ahead of chemistry.
Which category of animal fat can go to fuel?
All three, but the alternatives differ. Category 1 and 2 are limited to fuel and technical uses because the animal by-product rules close the feed and food routes. Category 3 can additionally go to feed and pet food, which is exactly why it is the contested one: four industries bid for the same material.
Does crude tall oil go to biofuel or to chemicals?
Both, and they compete. CTO feeds hydrotreatment for HVO and bionaphtha, and it is a long-standing oleochemical raw material. As a processing residue it falls under Annex IX Part A. Which route wins on a given parcel is usually a price question rather than a technical one.
Is SAF just HVO sold to airlines?
The HEFA route runs through the same hydrotreatment step, so the products are related, but the specification and the obligation behind them differ. ReFuelEU sets a separate synthetic sub-mandate that HEFA cannot fill, and aviation and road transport bid for the same hydrotreated molecules under different rules.
What decides whether a route is open to my cargo?
Three things, in this order: what the material actually is and where it came from, what your certificate scope covers, and what the greenhouse gas calculation over your specific chain produces. Specification matters, but it is rarely the thing that closes a door that classification has not already closed.
Market news
Recent headlines from across the feedstock and renewable fuel sector. Nothing specific to this market has come through the wires lately, so this is the wider view. The links go to the publisher; we do not host or edit their reporting, and a headline here is not our endorsement of it. Scroll for more.
- Singapore, Brazil move to build green fuel shipping corridor
- Auramarine builds business on marine fuel flexibility
- Stargate Hydrogen Strengthens Nordic Expansion with Petri Sarnes, Former Siemens Power Sector Director of FinBaltic region
- Econetix Adds New Biochar And Bamboo Project To Its Portfolio
- Everllence launches G80 ethanol capable engine for shipping with Vale
- Airfix, CO2 Energie AG and South Pole begin commercial cross-EU BECCS project
- California recycled content bill passes legislature
- RINA Type Approval for PowerCell Marine System 225
- Engine for ‘world’s first’ ethanol-powered VLOC completes R&D test
- Suzun Marine Fuels: Crew welfare and bunker contracts
- GMI doubles hydrogen bulker programme
- The top 10 most-read nova and RCI reports of the last 12 months
- UNDP, HUL partner to scale up circular economy for plastics
- Tyromer Wins Colorado Mining Cleantech Challenge with Circular Solution for Mining Tyres
- Solutions for smart human-centric remanufacturing
- Planning for a circular city
- Recycling bills clear House subcommittee
- Envalior, Secara MOU focuses on PCR use in automotive resins
18 headlines, updated automatically. Last refreshed .
Sources and further reading
Primary sources for the rules and figures on this page, so you can check them yourself. Legislation is amended: always read the consolidated text on the date that matters to you.
Who to ask about Feedstock to fuel
Just ask. Not sure which routes are open to your material? Send the origin, the specification and the certification, and we will say which products it can become and which door is closed. You get Bart van den Brug on the other end, same working day, in English or Dutch, and across the team also in French, Portuguese, Polish, Czech and Russian.
On how we work: on the feedstocks and fuels on this site we are a broker. We never take title, we do not trade our own book, and we are paid a commission on business that concludes. Additives are the one exception: those we also buy and sell for our own account, and we say in which capacity we are acting before you commit to anything. Either way you will hear it from us when the answer is no, or when your parcel is not ready for the conversation you want to have. A market read or a second opinion on a specification costs nothing and commits you to nothing.
Happy to look at whatever you have, even if it is half an analysis and a question.
+31 6 115 83 448
bart@sustainablecommodities.eu
Sustainable Commodities 3 B.V., Lemmer, the Netherlands
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Last reviewed 03 September 2026. Regulatory references are given for orientation and are not legal advice: verify against the current Official Journal text before contracting.