Aluminium plunged to its lowest price in more than seven years on Tuesday as physical stocks of the metal rose to a record and tumbling global equity markets stoked concerns about crumbling demand. Copper also fell after inventories of the metal climbed to the highest since late 2003. World equities fell to the lowest in almost six years, with Europe and Asia joining the sell-off after Wall Street hit a 12-year low on Monday on growing concerns about the financial system. "Everyone appears to be panicking at the moment -- I think things will be pretty horrible through Easter at least," Alex Heath, head of base metals trading at RBC Capital Markets, said. "Business is very sporadic at the moment, and while most of the bad news is already in the price, metals continue to follow the ebb and flow of the macroeconomic outlook." Aluminium for delivery in three months on the London Metal Exchange fell to a low of $1,279 a tonne before recovering to $1,286 by 1034 GMT from $1,288 on Monday. Inventories of the energy intensive metal -- used in transport and packaging -- leapt by 13,125 tonnes to stand at 3.17 million tonnes in LME warehouses, their highest ever level. Stocks have risen more than 35 percent since December. Strength in the dollar put more pressure on metal prices on Tuesday. Dollar-denominated commodities become more expensive for holders of other currencies. COPPER DEMAND CROPPED In Japan, production cuts by carmakers have hit demand for copper, used extensively in wiring and construction. An industry official said factories were shutting for a longer period during the week due to low demand for copper products. Japan's output of rolled copper products reached 43,390 tonnes in January, on an unadjusted basis, the lowest since August 1975. Copper for three-month delivery fell to $3,203 a tonne from $3,231 at the close on Monday. Stocks in LME warehouses rose 1,950 tonnes to 544,700 tonnes, the highest since October 2003. In China, low prices and slumping demand have forced the central government to buy metals as reserves, part of Beijing's plans to support smelters during the current slowdown. The State Reserves Bureau (SRB) has called a meeting in Beijing on Wednesday to buy refined zinc from smelters, its second purchase in less than two months, sources from smelters said on Tuesday. On Friday, the SRB bought 290,000 tonnes of primary aluminium from local smelters, according to a source familiar with the purchase, and last week might have contracted to import up to 240,000 tonnes of refined copper. Talk of SRB buying to boost reserves and the "very tight availability" of copper scrap should underpin the prices, analysts said. "The difficulty in getting scrap from abroad as well as the high prices are causing difficulties for local refiners that use scrap as raw materials as well as downstream processors. Some of them are turning to refined copper," Yingxi Yu at Barclays Capital in Singapore. China's imports of refined copper jumped 41 percent in January from a year earlier and its imports of copper scrap fell more than 56 percent. Yu at Barclays said demand for the industrial metal in the world's top copper consumer is expected to rise 3.5 percent this year -- half of last year's pace -- compared with flat growth for the world as a whole. Zinc fell to $1,081 from Monday's close at $1,098 a tonne. Key stainless steel ingredient nickel eased to $9,425 from $9,550 a tonne. Battery material lead dropped to $995 from $1,020, and tin fell to $10,300 from $10,405 a tonne. Metal Prices at 1040 GMT Metal Last Change Percent Move End 2007 Ytd Percent

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