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Brazilian refiners are looking to import used cooking oil (UCO) to produce sustainable aviation fuel (SAF), given the difficulties they face from constraints on domestic collection and traceability, and the strong economic appeal of the feedstock.
This residual feedstock is likely to gain greater importance in SAF projects, given expectations of higher margins from this biofuel than from biodiesel. Data from the hydrocarbons regulator ANP show that around 1% of the biodiesel produced in Brazil in 2025 used domestic used cooking oil as feedstock.
Brazil currently bans imports of used cooking oil, but the government is considering setting a quota, still undefined, to allow such imports exclusively for SAF production, according to recent comments from Euler Lage, a renewable energy project director at the presidential office.
If approved, market participants expect used cooking oil imports to come mainly from Asia, the leading global producer. Support from the Asian market is likely to be temporary, until other feedstocks of higher or comparable value become available to Brazilian producers.
Brazil's used cooking oil market remains unregulated and lacks official data. The processing association Abra began representing the used cooking oil sector in January, launching efforts to structure the market. Its initiative ranges from setting product specifications to improving traceability of used cooking oil.
Identifying the origin of the feedstock is a key requirement for a product to generate decarbonisation credits (CBios) under Brazil's Renovabio biofuel policy. The requirement applies to credits generated from the use of SAF and other biofuels, such as biodiesel and ethanol.
Abra is developing a specific national classification of economic activity codes for used cooking oil. Such a code is essential to grant formal recognition of the activity, allowing companies in the sector to be correctly classified, included in government statistics and afforded greater legal protection, association president Decio Coutinho told Argus.
The association is also developing an application to record information on the collection and movement of used cooking oil, with the aim of reducing traceability gaps and increasing transparency across the supply chain.
Abra estimates that Brazil is capable of collecting around 2 million metric tonnes of used cooking oil a year, roughly 40% of its edible oil consumption. More conservative estimates put collection volumes at 500,000 to 1 million metric tonnes a year, according to market participants.
Other feedstocks, such as soybean oil, industrial corn oil and beef tallow, are also drawing interest from Brazilian companies looking to produce SAF via the hydroprocessed esters and fatty acids (HEFA) pathway.
The 17,000 barrel per day Riograndense refinery in the southern state of Rio Grande do Sul plans to invest in oilseeds such as canola and carinata, taking advantage of the region's potential for winter crops. The project's strategic location would allow it to avoid dependence on the availability and collection of used cooking oil, according to the refinery.
The second production phase at the privately held 300,000 barrel per day Mataripe refinery in the north-eastern state of Bahia includes a SAF project based on macauba oil, the Brazilian yellow coconut, as its principal feedstock. Participants expect the refinery to shift all of its biofuel output to this alternative feedstock from 2035, replacing used cooking oil and soybean oil.
Both projects are initially aimed at serving international markets such as Europe and the United States, given the maturity and demand levels of those markets.
Brazilian SAF prices are expected to use the overseas market as a reference until the Brazilian market gains momentum.
Brazil currently produces 10,500 barrels per day of SAF, all at state-owned Petrobras's Reduc refinery. The country will produce 101,600 barrels per day by the end of this year.
The national aviation fuel programme, ProBioQAV, requires airlines to progressively reduce greenhouse gas emissions from their domestic operations from 2027 through the use of SAF. Under the rule, the mandatory greenhouse gas reduction starts at 1% in 2027 and rises gradually to 10% in 2037.
Source: Argus Media