The metal is seen dull this week just like most of the base metals and expected to penetrate even its current support level at $1,300 per tonne on the London Metal Exchange. The metal, which crashed in the beginning of the week to sub-$1,300 levels, however, recovered towards the week-end but the sentiment remains quite low. The metal will have to struggle hard to keep at the present levels, say analysts and traders.

``Domestic prices will remain unchanged as most of the producers are selling well below the import costs, says Sharad Parikh, Bombay Metal Exchange president.

Last week a flurry of activity in the beginning of the week saw hedge funds liquidating positions in the metal. Aluminium as expected crashed below $1,300 per tonne level on some heavy selling. However, it was somesensible technical buying that led to the metal recovery.

Massive stockpiles in Japan and absence of a major player, China have pushed the metal to some of its historic lows in October. Although traders in Japan did witness a fall in their stockpiles-from 403,000 tonnes to 393,000 tonnes in September, the metal is still up at 252,000 tonnes against 188,000 tonnes in June last year.

``In Japan, the market is raising alarms. The major consumer, transport sector is cutting down demand as never before with major car manufacturers like Toyota slowing down production,'' explains a metal analyst with an Indian broking firm.

The traders in Japan also feel that the it could be the next fiscal itself before the stockpiles come down to what they call ideal levels. No wonder, in October first week, the Japanese buyers did not place any orders when the dollar crashed against yen.

Aluminium was in the limelight for a while during the beginning of the month as traders were believed to have been booking for 2001 and2002. That is over now and everything is back to normal.

``The metal is following copper closely and since the general sentiment is quite low, none of the non-ferrous metals is expected to show any rally next week,'' Sharad Parikh adds.

``Aluminium will remain in low demand for the next quarter as everybody has bought enough and there are much surplus,'' the Indian analyst said.He said that since most of the deliveries have been taken, any recovery in prices can be ruled out. Japanese buyers, who frequent the market on each occasion the dollar crashes against yean, are unlikely to place many orders for the metal and so are Chinese, another major buyers, who all the while have been absent from the market.

Dramatic drop premiums has been the major reason plaguing the Russian metal industry, one of the world's largest. The world wide production of the metal has recorded a lower growth of 2.9 per cent during the first eight months of 1998.

In fact, the metal was never supported through a concertedproduction cut by the manufacturers except individual companies making minor reductions suiting them. Even the proposed mega mergers between Nippon Light and Toyo Aluminium and Furukawa Electric and Sky Aluminium fail to cheer the markets.

Packaging sector demand in Europe is seen flat with the only consolation being the transport sector which has started using cast and wrought aluminium on a larger scale, traders said.