ALCOA DECLINES SPECIFIC COMMENT ON OPTIONS TRADE

  Alcoa officials acknowledged the
  possibility that they may have a position in the off-exchange
  aluminum options market, but declined specific comment on trade
  speculation that the company is holding a large outstanding
  position.
      An Alcoa (Aluminum Company of America) source involved in
  terminal trading for the company said: "We use all means
  available to manage our business, so it's a possibility we're
  trading options."
      "We won't go into specifics about what we're doing. But
  when you're dealing in un-alloyed ingot, it's a commodity
  business where there are a lot of tools available (for hedging)
  and Alcoa is using all of those tools," said Al Posti, Alcoa's
  manager of corporate news.
      Trade sources have said Alcoa is long call options equal to
  30,000 to 50,000 tonnes of aluminum due to mature in April and
  May. However, some New York-based aluminium traders said they
  believe the size of Alcoa's position has been exaggerated.
      The possibility that Alcoa may be long call options is one
  factor indicating that supply tightness may worsen in the
  second quarter, traders said.
      "If they decide to exercise their right to buy, it would
  mean really squeezing the market," one New York trader said,
  noting that aluminum stocks on the London Metal Exchange were
  90,500 tonnes at the end of last week.
  

