What causes this issue?

The total capacity of supplier &V1& (supplier capacity in the current
period plus validity extension for unused supplier capacities from
previous periods) has been exceeded by the quantities already ordered.
This can occur in the following cases:
A supplier capacity was reduced at a later time and distribution
requirements planning (DRP) can no longer reduce the planned quantities
(freeze horizon or limited freeze horizon).
A schedule line was created manually and fixed. DRP cannot change this
fixed schedule line.

System Response

DRP does not create further purchase orders or scheduling agreement
delivery schedule lines in this period. The capacity restriction remains
exceeded.

How to fix this error?

Check whether one of the following has occurred:
Schedule lines were created manually, which could lead to capacity
restrictions being exceeded.
The capacity restrictions were reduced.

Procedure for System Administrators

The system issues an error message and will not allow you to continue with this transaction until the error is resolved.

Error message extract from SAP system. Copyright SAP SE.