Iron and steelmaking at a huge steelworks is to be mothballed, with the loss of 1,700 jobs, dealing a "devastating" blow to the industry.
Thai firm SSI said it was with "regret" that it had to announce the decision to mothball facilities at its Redcar plant on Teesside.
The company said that after a further evaluation of the business, it had "no other option", blaming a severe deterioration in steel prices.
Unions said the announcement was devastating for the area and the economy and claimed the Government should shoulder some of the blame.
The company said: "SSI UK regret to announce that after a further evaluation and assessment of the situation facing the business, it has concluded that they are faced with no other option but to mothball its iron and steel making facilities on Teesside. The Redcar Coke Ovens and the Power Station will continue to operate.
"This decision has had to be taken against a continuing background of poor steel trading conditions across the globe and the consequential severe deterioration in steel prices experienced during the course of 2015, together with the view that this is unlikely to change in the short term.
"We will continue to work with various stakeholders, including government, with the objective of restarting operations at Teesside at some point in the future.
"As a further consequence of the mothballing, it is proposed to reduce by 1,700 employees, including those affected by the mothballing of the South Bank Coke Ovens which was announced previously.
"Consultation with the trade unions and employee representatives will commence as soon as possible."
Cornelius Louwrens, UK business director and chief operating officer said: "This is an extremely sad day for all of us at SSI UK, and in particular our employees and their families. Together with our parent company and the various other stakeholders, they have worked so hard in their endeavours to try and make this business successful.
"Despite the significant progress we made in the financial performance of the business during 2014, market conditions this year have been extremely challenging and unfortunately this has led to the decision we are announcing today.
"I would like to pay tribute to and thank everyone connected with SSI UK for their great support. My wish is that this facility can once again restart operations and fulfil the potential of the plant and its loyal workforce."