Material to material transfer for in-house production not supported

What causes this issue?

You are trying to execute a posting material - material for an
internally produced material. This material however, is affected by the
requirements grouping and the pegged requirements display. You cannot
post material - material for materials that are affected by the above.

System Response

The posting cannot be executed.

How to fix this error?

Check the <DS:TRAN.0PEG02>Customizing settings</> for the movement
type. If necessary, contact your system administration.

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.