Enhancing Resilience Through Traceability

Executive summary

Reliable access to critical minerals has become central to economic security and competitiveness. Increasing global demand is intensifying pressure on highly concentrated and strained supply chains. Market concentration of processing, smelting and refining is particularly acute, while investment is lagging behind demand and operational and governance risks persist. This threatens to undermine the reliable supply of these resources and resilience of industries that use them.

National and multilateral initiatives to enhance economic security by developing more resilient and diversified critical mineral supply chains will require supply chain transparency to be fully implementable. Reliable supply chain data is at the core of traceability systems. Price floors and similar trade-related measures need verified information on origin and production conditions to direct support toward trusted and responsible producers. Stockpiling programmes need provenance, grade and ownership data for acquired commodities. Finally, preferential procurement initiatives require chain of custody data to exclude entities of concern.

Traceability can bolster the integrity and credibility of supply chain due diligence. Traceability has emerged as a tool for policymakers and industry to enhance the resilience of mineral supply chains as policy and market demand increasingly drive companies’ adoption of responsible business conduct practices.

This report assesses the uptake, drivers and limitations of traceability in critical mineral supply chains, focusing on lithium in Argentina and Chile, and nickel in Indonesia and the Philippines. It draws on an OECD-IEA survey of 90 leading companies across critical minerals value chains. The survey was complemented by stakeholder interviews and site visits.

Key findings

Uptake of traceability

In practice, a combination of supply chain mapping, mass balance and auditing, often as part of wider due diligence efforts, already supports partial visibility without end-to-end traceability. Current traceability systems remain fragmented. Hybrid, government-led platforms, such as Indonesia's SIMBARA, alongside industry and multi-stakeholder responsible sourcing systems, provide a foundation that targeted policy measures could strengthen.

Uptake of traceability by the private sector is growing but uneven. Notably, most traceability systems are being developed within individual companies using proprietary tools with limited public disclosure. Uptake is strongest among traders, who report the highest implementation rates, and weakest among miners. Over 60% of respondents identify brand reputation or customer demand as primary drivers, with regulatory compliance a close second.

Barriers to traceability

There are substantial barriers to the uptake of traceability. More than half of survey respondents identify costs and lack of interoperability as barriers to setting up traceability systems. The operation of such systems is further constrained by confidentiality concerns, supplier leverage and data quality concerns. Half of survey respondents rank regulatory consistency as the top priority for scaling traceability, with a similar share citing shared data infrastructure.

Ownership opacity is a significant blind spot. Complex and layered corporate structures obscure who ultimately controls key mineral assets, particularly along nickel supply chains. This matters for both responsible sourcing and economic security.

Despite these challenges, industry adoption of traceability is growing at pace. Nearly three-quarters of respondents plan to increase investment in traceability, but most report that it is too early to identify tangible benefits. The absence of price premia, for example, remains a persistent disincentive.

Policy recommendations

A targeted approach to traceability, calibrated to the risk profile and strategic sensitivity of each material and end use, is both more practical and more effective than uniform requirements across all supply chains. This report presents a roadmap for policymakers to promote traceability over the near to long term. It recommends a phased, risk-based approach in which traceability intensity narrows in scope and deepens in rigour in accordance with risk and strategic sensitivities.

• In the near term, governments can leverage what is already in place. Trade data and supplier mapping can be used to monitor processing dependencies. Existing audit programmes can strengthen country-of-origin disclosure for smelters and refiners. Bilateral mineral agreements and development financing can embed RBC standards and transparency.

• In the medium term, governments should work to close data gaps. This requires deepening engagement with midstream actors such as traders, exchanges and smelters. They should strengthen beneficial ownership transparency, especially for complex joint ownership structures. Independent mineral testing as part of tracking the physical evolution of minerals and tracking of recycled content should be introduced.

• In the longer term, governments should address measures that require international co-operation. Interoperable data platforms will secure traceability data across borders. Systems should adopt identity preservation for the most sensitive materials. Governments should also adopt expanded digital product passports, aligned with international standards, for batteries and high-impact products.

The recommendations in this report are designed to be operationalised through existing frameworks, including the G7 Critical Minerals Action Plan and Roadmap to Promote Standards-based Markets, FORGE, RESourceEU and bilateral critical mineral agreements, and have informed wider international discussions, including the G7 Leaders’ Declaration on Securing Supply Chains for Critical Minerals.

Applying a targeted approach to lithium and nickel

Lithium and nickel are essential for the green transition, defence and industrial applications. Both have been identified by OECD Members and across G7 frameworks as priorities for investment, diversification and governance improvement.

For lithium sourcing from Argentina and Chile, significant processing dependencies in China are well captured by existing trade data and supplier mapping. Enhanced ownership transparency could help address the presence of foreign entities of concern in the upstream supply chain.

The nickel supply chain in Indonesia and the Philippines is more complex, including exposure to elaborate, transnational ownership structures. Existing systems such as SIMBARA and the London Metal Exchange responsible sourcing requirements provide a strong basis for supply chain transparency, in addition to mines in both countries increasingly participating in sustainability initiatives and audits. Building on these approaches can address outstanding gaps.

Co-operation among the G7, OECD, IEA and trade partners can serve as a platform, including through multi-stakeholder engagement, to operationalise these recommendations. A priority for this co-operation should be aligning minimum traceability requirements across economic security instruments so that data collected for one purpose, such as price floor eligibility, can also serve others, such as defence procurement or stockpiling, avoiding duplication and ensuring that the economic security toolkit rests on a common, interoperable data foundation.