* China’s downstream steel demand seen intact
* China April steel output climbs to monthly record
* Vale may expand Carajas Serra Sul mine, doubling output
By Enrico Dela Cruz
MANILA, May 15 (Reuters) - Steel futures in China struggled in early trade on Wednesday, with rebar hovering near a five-week low, on lingering concerns over the economic impact of a prolonged U.S.-China trade war, while waning demand pulled down iron ore prices.
The most-active rebar contract on the Shanghai Futures Exchange was almost flat at 3673 yuan ($534.54) a tonne as of 0244 GMT, having fallen to 3,650 yuan earlier in the session, the lowest level for the construction steel since April 8.
Hot rolled coil, used in cars and home appliances, edged up 0.1% to 3,603 yuan a tonne.
Support for steel emerged somewhat after two days of losses amid hopes that trade tensions between the United States and China would eventually ease, and with demand particularly for construction steel intact.
U.S. President Donald Trump on Tuesday called the trade war with China “a little squabble” and insisted talks between the world’s two largest economies had not collapsed.
“The concern about trade tariffs is temporary and steel demand within China remains strong,” said Darren Toh, a data scientist with Singapore-based steel and iron ore data analytics company Tivlon Technologies.
“Steelmakers in China are still making profits, and demand is intact even as crude steel production remains high,” he said.
China’s crude steel production rose 12.7% in April from March to its highest monthly level on record, official data showed on Wednesday, bolstered by firm demand and good profitability in steelmaking.
Amid a clouded outlook for steel demand in the future and high steel output, iron ore and other steelmaking ingredients edged lower.
The most-traded iron ore contract on the Dalian Commodity Exchange was down 0.8% to 647 yuan a tonne, having fallen as much as 1.7% earlier in the session.
Supply issues continued to provide some support for iron ore. On Tuesday, Brazilian miner Vale SA said it is considering doubling the output of its Carajas Serra Sul iron ore mine in the northern part of the country after 2020.
Coking coal edged down 0.3% to 1,345 yuan a tonne and coke slipped 0.2% to 2,104 yuan.
($1 = 6.8713 Chinese yuan)
Reporting by Enrico dela Cruz; Editing by Rashmi Aich