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Copper is a very ordinary building material that has become entwined in every facet of our lives, from the wires in our homes to our smartphones and, critically, electric cars, which use three times the amount of the metal as those in a conventional vehicle.

The start of a long-term demand trend is occurring in China, where copper in electric cars is set to offset a sharp fall associated with sales of petrol cars this year, according to analysts at Citigroup.

The number of petrol cars made in China this year is expected to drop by 9 per cent, according to Citi, while electric car production is set to rise by 53 per cent. That results in net copper demand growth of 0.3 per cent for the sector.

“[For copper] it’s an EV story into the 2020s and we’re just getting a really early taste of that now,” said Oliver Nugent, of Citi. “Thanks to the higher intensity of copper in EVs we’re going to sail through that very weak auto demand number this year.”

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Over the longer term, the bank said copper for electric cars would make up two-thirds of demand growth for the metal between 2018 and 2030.

Copper prices have rallied by 5 per cent this year to trade at $6,139 a tonne, suggesting that investors have become less fearful of the impact of a slowdown in China, the world’s largest consumer.

Citi expects copper prices to hit $6,700 in 2019 driven by an overall 2 per cent growth in Chinese demand and a resolution to the trade dispute between the US and China.

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