Government negligence is to blame for the collapse of British steel business Aartee Bright Bar, a steelworkers’ union has claimed.

Aartee Bright Bar, which says it is the UK’s largest distributor of engineering steel products, called in administrators Alvarez & Marsal (A&M) on Tuesday after facing tough economic conditions and surging metal costs.

The leading trade union for steelworkers, Community, hit out at the Government for failing to act sooner over issues including increased energy costs, which have heaped pressure on struggling firms in the sector.

The West Midlands-based business has around 250 staff, operating from two productions sites in Willenhall and Dudley, and three distribution and sales offices in Rugby, Bolton, and Newport in South Wales.

It is not yet known whether there will be an impact on jobs following the insolvency.

Michael Magnay, joint administrator at A&M, said: “Like many businesses in its sector, Aartee Bright Bar has been facing significant headwinds as a result of the challenging economic environment and fluctuating steel prices.

“Against this backdrop, administrators have been appointed and we are exploring the options available to preserve value.”

Trade union Community argued that the business’s collapse was representative of the pressure the wider industry was facing, particularly from high energy and metal costs.

Alun Davies, national officer for Community, said: “The news of Aartee Bright Bar crashing into administration is extremely worrying.

“All parties must do whatever it takes to protect the workforce in this difficult process.

“These developments demonstrate the extreme pressures the industry is under.

“This is the price of Government’s negligence and its failure to act on issues like energy costs and procurement.”

The news follows reports last week that British Steel is planning to axe hundreds of jobs as part of closures of its coke ovens in Scunthorpe, according to a union source.

The Government is reportedly considering cash injections into both British Steel and Tata Steel UK.

But Charlotte Brumpton-Childs, national officer at the GMB union, said the Government’s investment was a “sticking plaster that does nothing to help the long-term structural issues affecting our steel industry”.

She added that the steel industry could “wither and die like so much of our proud manufacturing heritage” without meaningful support.

Furthermore, Liberty Steel revealed last month it was implementing the next stage of its restructuring programme which could affect up to 440 jobs.

The firm said it needed to refocus its operations in order to adapt quickly to the challenging market.

Liberty Steel, headed up by Sanjeev Gupta, counts Aartee Bright Bar as one of its customers, according to reports.

There are more than 33,000 people directly employed by Britain’s steel industry and a further 40,000 working in the steel supply chain, Community said.

Britain’s steel industry will be worth £6 billion by 2030.