SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                 FORM 8-K
                                CURRENT REPORT

                   Pursuant to Section 13 or 15(d) of the
                      Securities Exchange Act of 1934

                             December 23, 1999
                     (Date of earliest event reported)


                      Birmingham Steel Corporation
               (Exact Name of Registrant as Specified in its charter)

     Delaware                       1-9820               13-3213634
(State or Jurisdiction       (Commission File No.)      (IRS Employer
 of Incorporation)                                      Identification No.)


        1000 Urban Center Drive, Suite 300, Birmingham, Alabama 35242-2516
      (Address of principal executive offices, including zip code)


                           (205) 970-1200
        (Registrant's telephone number, including area code)


                            Not Applicable
     (Former name or former address, if changed since last report)




(Logo)                                                 POST OFFICE BOX 1208
                                                       BIRMINGHAM, AL 35201
                                                       PHONE (205) 970-1200


                                      Contact:    J. Daniel Garrett
                                      Vice President-Finance & Control
                                      (205) 970-1213




BIRMINGHAM,  Ala (December 23, 1999) -- Birmingham Steel Corporation  (NYSE:BIR)
today issued the following letter to stockholders:

Dear Fellow Stockholders:                                    December  23, 1999

As you know, on December 2, 1999,  Birmingham Steel  Corporation ("the Company")
began  operating  with new  management  under my  direction  as Chief  Executive
Officer and Chairman of the Board of Directors. The Company's Board now includes
nine  individuals  who were proposed by the United Group during the recent proxy
contest and three individuals who served on the previous Board.

Since  joining  Birmingham  Steel three weeks ago, I have been busy meeting with
various  stakeholders in the Company,  including  employees,  lenders,  vendors,
suppliers and  shareholders.  I have also called upon Jim Todd,  former chairman
and chief executive  officer of Birmingham  Steel, to assist me in reviewing the
Company's current financial and operating situation. We now have a more thorough
understanding of the issues and challenges  facing new management as we endeavor
to return Birmingham Steel to  profitability.  It is also apparent that the real
challenge  will be to restore  the  Company  to an  acceptable  and  competitive
financial condition.

This letter will convey my assessment of the state of the Company based upon the
information I have learned in my brief tenure with Birmingham Steel. The primary
issues that I believe must be  immediately  addressed by the new  management and
Board are:

o    The Company's significant debt level - approximately $734 million including
     off-balance sheet obligations
o    The limited  operating and financial  flexibility  allowed  pursuant to the
     Company's loan agreements which were renegotiated in October, 1999
o    The continued cash drain from the SBQ operations
o    The completion of start-up operations at the new Cartersville rolling mill

At the  outset,  let me state  that I believe  Birmingham  Steel has  tremendous
potential,  good assets and an excellent and highly  motivated  workforce.  I am
confident  the Company can be turned  around and returned to a stable  financial
condition.  However,  diligent  effort will be required by all of our employees.
Furthermore,  senior management must regain the trust, confidence and support of
the Company's employees,  customers,  suppliers and lenders. WE BELIEVE WE WILL.
Without question, however, we face a daunting task.

DEBT LEVEL
As of today, the Company has approximately $252 million outstanding under a $270
million  revolving line of credit (the  "Revolver").  We expect borrowings under
the Revolver  will  increase to $260-$265  million by December 31, 1999.  In the
five  months  prior to the  change  in  management,  usage  under  the  Revolver
significantly  increased  because of (1) funding of continued  losses in the SBQ
businesses;  (2) continued  start-up  costs at  Cartersville;  (3) a build-up in
inventories;  (4) significant proxy contest  expenses;  (5) loan amendment fees;
and (6) higher interest costs as a result of the new financing amendments.

Although  availability  under the  Revolver  will  increase  to $300  million on
January 1, 2000, we have determined the Company will not have  sufficient  funds
to support ongoing  operations unless substantial steps are taken to immediately
reduce the outflow of cash. To begin the cash  conservation  program,  the Board
recently announced  suspension of the dividend on the Company's common stock. We
also recently  implemented measures to immediately reduce spending by curtailing
production  in order to reduce  inventories.  We are reviewing the financial and
operating  performance and cash  requirements of the SBQ operations to determine
if cash can be conserved by  temporarily  closing some SBQ  facilities.  We have
also initiated a review of the entire organization  staffing levels to determine
if a reduction in the number of personnel is feasible.

During the past few weeks, we have had informal discussions with representatives
from the Company's  lenders regarding the need to refine some of the restrictive
provisions in the recent loan agreements. For example, a decision to temporarily
close certain SBQ facilities  would require the  cooperation of the lenders.  We
plan to meet with representatives of each lender group in early January 2000, to
discuss  modifications  which are necessary in order to more effectively  manage
the Company.

SBQ OPERATIONS
Through the first five months of fiscal 2000,  the SBQ division - which includes
the Company's  operations in Memphis and Cleveland - generated  operating losses
of $34 million.  Because of the accounting  treatment applicable to discontinued
operations,  SBQ  operating  losses  are  being  offset  against  balance  sheet
reserves, which were established in connection with major writedowns,  initiated
by prior management in the fourth quarter of fiscal 1999.

Prior management had aggressively  pursued the sale of the SBQ assets.  However,
to date, only one conditional  offer has been received for the Cleveland rolling
mills,  and this  offer was  significantly  below the fair  market  value of the
assets.  Although  some  interest  was shown for the Memphis and  American  Iron
Reduction  direct  reduced  iron  facilities,  no offers have been  received for
either of these operations.

The process conducted for the sale of the SBQ operations was constrained because
of several factors,  including prior management's mandate that firm bids with no
contingencies  be  submitted  prior to December  2. As a result,  the ability of
potential buyers' to perform due diligence and conduct meaningful  dialogue with
the Company was limited.  The SBQ sales  process was also  compromised  by prior
management's  assertions  during the proxy  contest  that (1) the demand  market
accessible  by the Cleveland  operation was only 1.0 million tons per year;  and
(2) an additional $100 million in capital  expenditures are required in order to
fully utilize the Cleveland  rolling mills.  Based upon the feedback  during the
recent  efforts to sell SBQ, we do not believe  these assets will be sold in the
near future for a realistic price.

We have  conducted a limited  review of the SBQ market and  confirmed  the total
annual demand for the range of products  capable of being  produced at Cleveland
is approximately 8.0 million tons. We believe that qualified billets produced at
Memphis or  purchased  from third party  suppliers  could  support a  profitable
business at Cleveland and allow the SBQ division to regain its previous position
as the premiere  high  quality  supplier of SBQ  products in North  America.  We
believe  limited  capital  expenditures  in the range of $10-$15 million are all
that  is   necessary   to  make  Memphis   viable.   The  primary   obstacle  to
re-establishing  the Company's SBQ business is the cash  commitment  required to
provide  working  capital  support.  Unfortunately,  the current  requirement to
conserve cash will limit the Company's  ability to increase its opportunities in
SBQ in the near term.

Although  there are no  imminent  buyers for the SBQ assets,  we have  initiated
conversations with previously  established contacts in the SBQ market to explore
possible joint venture  opportunities  or sale of the Company's SBQ assets.  One
such  possibility  is to utilize the Memphis melt shop in  conjunction  with new
projects currently under consideration by other companies.

Management is open to any activity or arrangement  that would provide  financial
flexibility  to the Company and improve its  economic  viability.  We would also
consider other  arrangements,  including a sale or merger of the entire Company,
if in the best interest of the shareholders.

CARTERSVILLE START-UP
Through  the  first  five  months  of fiscal  2000,  losses at the  Cartersville
operation  were $13  million,  including $7 million for losses  associated  with
start-up of the new  mid-section  mill.  The  start-up  plan is  scheduled to be
completed  by the end of the third  quarter of fiscal  2000  (March  31,  2000).
However,  new  electrical  controls,  which  are  being  installed,  will not be
completed until  February.  Until the electrical  installation is complete,  the
mill  will be  restricted  as to the  number  of  products  that can be  rolled.
Although we are optimistic  that  Cartersville  can become cash neutral by March
31, 2000, we are implementing measures to improve  productivity,  increase sales
and  reduce  cash costs at  Cartersville  in the near  term.  We do believe  the
Cartersville  operation  represents an excellent  long-term  opportunity for the
Company,  and we will  give  top  priority  to  building  a viable  business  at
Cartersville.

CONCLUSION
Although we face challenging times, particularly through the end of fiscal 2000,
your management and Board are committed to improving  financial  performance and
enhancing  shareholder  value.  We are confident  that,  with the dedication and
diligence  of our  employees  and the  cooperation  of our  lenders,  we will be
successful  in  returning   Birmingham  Steel  to  profitability  and  financial
stability.  To demonstrate  commitment to the turnaround effort,  management and
the Board have taken the following actions:

o My salary has been  voluntarily  reduced by 15%
o My annual bonus will be paid in common shares  rather than cash
o The annual  retainer paid to members of the Board will be 1,500  shares
o The  directors'  meeting fees for fiscal 2000 have been waived
o The  directors'  annual option awards will increase to 5,000 common
  shares per director

Our core operations are performing well and generating  significant  profits. We
are  committed  to the  completion  of  the  Cartersville  start-up,  and we are
optimistic about the long-term prospects for the Cartersville  operation. We are
willing to take whatever  action is  appropriate  with respect to first reducing
and then  eliminating the cash drain by the SBQ operations.  Your management and
Board are focused on improving  the balance  sheet and  securing  the  financial
flexibility necessary to move the Company forward.

We regard the shareholders as the owners of the Company, and we appreciate,  and
hope to merit,  your  continued  support.  We will  continue  to provide  candid
updates concerning management's progress in turning the Company around.

Thank you for your assistance and support.

Sincerely,



John D. Correnti
Chairman and Chief Executive Officer

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