SHANGHAI – The global copper market will be balanced for the foreseeable future even as mine supplies tighten and demand from China, the world's top consumer, remains strong, executives from major copper companies said on Wednesday.

The forecast came as executives warned that rising environmental regulation in Chile, the world's top producer, and China, the world's top consumer, are raising production costs for smelters and miners.

Antofagasta PLC chief executive officer Ivan Arriagada said he expects the market to be balanced or in a small deficit this year and into 2018.

Refined copper demand is growing at a "healthy rate" of 4 percent this year and new production "has largely already been absorbed in the market", Arriagada said at the Asia Copper Conference.

Declining ore grades, prolonged bureaucracy for getting new projects approved and technical challenges will continue to constrain supplies, he said.

These issues are spurring miners and smelters to develop new innovations, such as using artificial intelligence, to improve productivity and efficiency, the executives said.

Liangang Li, deputy general manager of China Minmetals Non-Ferrous Metals Co said he expects a balanced market for the next two years. The company is part of China Minmetals Corp , one of the country's largest miners and metals traders.

NORTH OF $6,600

Copper prices on the London Metal Exchange remain elevated at around three-year highs, even topping $7,000 per tonne on Monday, as investors bet on stronger demand from electric vehicles and investment by China in its power grid as the country seeks to boost clean energy use.

However, there are concerns about the strength of Chinese demand and manufacturing as the country imposes unprecedented steps to curb the smog that blankets the north of the country in the winter.

Copper prices need to remain high - north of $6,600 per tonne - to encourage investment in new mines to replace falling ore grades in some of the world's oldest mines in Chile, the executives said.

"If prices can't stay at a certain level, new investment in copper mining will fall, leading to a big shortage of concentrate, so I am bullish on copper prices," said China Minmetal's Li.

The Chief Executive Officer of Chilean state copper company Codelco, Nelson Pizarro, said he expects copper prices to hold between $2.80 per pound (0.45 kg) and $3.10 per pound over the short- to medium-term, which equates $6,171 to 6,832 per tonne.

Copper is currently trading at around $3.10 per pound .

"The cost structure is increasing. It's inflation, labour and environmental regulation gets more severe," said Shigeru Oi, Chief Executive of JX Nippon Mining & Metals, a unit of JX Holdings.