British Steel, the largest steel producer in the UK, made a very unexpected decision for the market to stop placing new orders for steel rolling, sending letters to service centers and steel contractors on Monday.
The letter entitled “Extreme Demand and Capacity Limit Alert” states: “Due to extremely high demand affecting capacity levels ... British Steel is temporarily closing the order book and therefore we cannot immediately accept any new orders for production ".
Stunned customers are trying to assess the impact of this decision on their business this morning. No one knows which product lines are affected or how long it will last.
“This will be a real headache for everyone, because we will have to turn to alternative suppliers and find out what is in the warehouses in the metal centers. Now the question is where will you get the steel from and, of course, at what price, ”a UK steel market player comments.
British Steel has been rumored to be working 24/7 on all production machines in recent weeks, with some customers struggling to deliver orders on time.
The decision to stop accepting new orders is unlikely to have an immediate impact on construction projects, because orders will be placed several months in advance. But it could disrupt small jobs and have an impact later this year.
The quota race will now begin with alternative suppliers such as ArcelorMittal or other European manufacturers that are believed to still have spare capacity.