* Deliveries unease pressures CME live cattle
* Feeders slip on weak live cattle market
By Theopolis Waters
CHICAGO, Aug 2 (Reuters) - Chicago Mercantile Exchange hogs
closed higher on Friday as strong pork prices lifted
futures for a third straight session, traders and analysts said.
Friday morning's USDA mandatory wholesale pork price report,
or cutout, was $103.67 per hundredweight (cwt). The price surged
$2.89 from Thursday to its highest since $104.86 on July 9.
Tight supplies of frozen pork bellies, which are processed
into bacon, led the charge, a trader said. Bellies are in high
demand with the summer's bacon-lettuce-tomato season in full
swing, he said.
Packing plants which were offline on Monday for a floater
holiday, and to recover lost margins, slowed the flow of fresh
pork to grocers.
Pork processors that were closed on Monday and those
scheduled to be dark on Aug. 5 for a floater holiday will make
up the downtimes on Saturday.
CME hogs settled up 0.61 percent for the week.
August closed at 99.250 cents per lb, 0.825 cent
higher. October ended at 83.950 cents, up 0.050 cent.
DELIVERY WORRIES UNDERCUT CATTLE
CME live cattle posted modest losses following a choppy
session as jitters about next week's deliveries weighed, traders
and analysts said.
August futures' premium to cash prices has narrowed
significantly in recent weeks which could reduce the number of
deliveries, said CattleHedging.com analyst Elaine Johnson.
Spread traders sold August futures and bought the October
contract given lackluster beef demand and generally steady cash
Bullish investors are expecting a seasonal bounce in cash
prices fueled by the prospect of increased beef buying as
temperatures moderate in the fall.
Instead, cash prices have hovered around $119 per cwt for
several weeks amid the usual lull in summer beef demand.
This week, cash cattle in Texas sold at $119 per
hundredweight and mostly $119 in Kansas, with a few at $120,
said feedlot sources.
They said the bulk of live-basis cattle in Nebraska on
average fetched $120.50 per cwt, roughly steady with a week ago.
USDA on Friday morning quoted the wholesale price of choice
beef at $186.78 per cwt, up 12 cents from Thursday. Select cuts
dropped 54 cents to $180.99.
For the week, live cattle futures slipped 0.76
August live cattle closed down 0.150 cent to 120.650
cents per lb and October at 124.475 cents, or 0.025 cent
Profit taking after four straight days of advances and weak
CME live cattle pressured feeder cattle futures.
Despite Friday's moderate setback, CME feeder cattle
were up 0.88 for the week, their third straight weekly gain.
August feeders closed at 153.725 cents, down 0.025
cent per lb, and September at 157.000 cents, or 0.250
(Editing by James Dalgleish)