"Stockpiles are expected to come down to an appropriate level sometime around April or May this year. After that, Japanese buying (of aluminium) will likely pick up," Fukushima said in an interview with Reuters.

Aluminium stocks at Yokohama and Nagoya totalled some 318,000 tonnes at the end of December, down from last year's peak of over 400,000 tonnes, he said.

Japanese aluminium imports, including refined aluminium, dropped to 188,440 tonnes in November from 191,990 tonnes in October, the latest data by Japan's finance ministry showed.

Meanwhile, news from Europe on aluminium was mixed. Russian aluminium exports increased 3.2 per cent to 2.54 million tonnes in January-November last year from 2.46 million in the same period in 1997, trade ministrydata showed.

Nickel exports were down 5.3 per cent, while copper exports remained at the same level as in the first 11 months of 1997.

In Germany, the aluminium sector was busy coping with wage pressures. Employers in Germany's large metal and engineering sector are to offer workers an annual pay rise of around two per cent, employer sources said.

Trade Union IG Metall has demanded a rise of 6.5 per cent and has threatened strikes if the demand is not met. The employers' offer to the some 3.4 million workers in the sector is expected to be made official at regional sector negotiations later on Friday.

Employer sources confirmed that figures contained in a report by Bild newspaper "were in the right area". Bild said a two per cent offer would be put on the table, together with further one-off profit-based benefits up to 0.5 per cent.

IG Metall has said its demand takes into account a calculated productivity rise of some 2.5 per cent across the sector plus 1.5 per cent inflation.

Finance ministerOskar Lafontaine said earlier this week he believed annual pay settlements that took into consideration productivity rises and inflation would be "sensible".

Negotiations in the metal and engineering sector are due to go ahead in five regions on Friday. Regional pay deals can be used as "model" settlements for the sector as a whole.