CAIRO (Reuters) - Islamic State supporters posted a video on Wednesday showing an elderly German man believed to have been kidnapped by Filipino Islamist Abu Sayyaf rebels last November.

The video shows the German man in an orange jumpsuit standing in a freshly dug grave as black-clad. Masked militants behind him held assault rifles and, speaking Arabic, threatened the German government in English while the Islamic State black flag stood in the background.

"To the German government: it seems that you are not paying attention to our demands. Failure to pay the ransom will cause the beheading of this German citizen," one of the masked men can be heard saying.

The German foreign ministry declined to comment on the video, saying it was its policy not to discuss cases involving Germans kidnapped abroad.

Soldiers had found the body of a German woman on an abandoned yacht in the troubled waters of the southern Philippines on Nov. 7 and said they suspected her companion may have been taken captive by Abu Sayyaf rebels.

The body was found naked and with gunshot wounds on the yacht which bore a German flag and was docked on a remote island in the Sulu archipelago, a stronghold of the Abu Sayyaf.

Abu Sayyaf is an al-Qaeda linked group known for kidnapping and increasingly, piracy. Several of its factions have declared their allegiance to Islamic State since 2014.

The Filipino army at the time said the Abu Sayyaf leader, Muamar Askali, had made claims on radio that they were holding a 70-year-old German after intercepting the yacht in Sabah, eastern Malaysia, a week earlier.

Abu Sayyaf rebels have since March been intercepting slow-moving tug boats towing coal barges in waters near the borders of Malaysia and the Philippines, taking captive more than a dozen Indonesian and Malaysian sailors.

Several hostages have been freed, after paying ransom to the Abu Sayyaf, a group known for kidnappings and beheadings, including two Canadians this year.

It is holding 15 captives, including a Netherlands citizen, five Malaysians, two Indonesians and seven Filipinos.

(Reporting by Ali Abdelaty; Additional reporting by Andrea Shalal in Berlin; Writing by Ahmed Aboulenein; Editing by Ralph Boulton)