CHICAGO, May 21 (Reuters) - Chicago Mercantile Exchange lean hog futures dropped to their lowest level since February under pressure from solid U.S. production on Tuesday, while live cattle futures reached their highest price since March, analysts said.
The hog market has declined 12% from a contract high reached last month.
"Every little bounce we've got going has been sold," said Matt Wiegand, commodity broker for FuturesOne.
Production has weighed on futures, he said, as U.S. government data show pork processors have slaughtered about 50.6 million hogs so far this year, up from 50.3 million last year. They butchered about 480,000 hogs on Tuesday, unchanged from a week ago but up from 476,006 hogs a year ago, according to the U.S. Department of Agriculture.
CME June hog futures ended down 0.525 cent at 96.400 cents per pound after falling to their lowest price since Feb. 14.
"We haven't been able to generate much short covering," Wiegand said. "We should probably see that at some point."
In the cattle market, U.S. beef demand is expected to increase as the upcoming Memorial Day weekend signals the start of the summer grilling season.
Traders kept their eyes on wholesale beef prices that have surged over the past week. The select boxed beef cutout rose by $1.95 to $299.35 per cwt, while the choice cutout eased by $0.75 to $312.70 per cwt, the USDA said.
Meatpackers are now making money processing cattle into beef, after losing more than $100 per head last week, according to HedgersEdge.com.
Processors have struggled with tight U.S. cattle supplies after ranchers slashed their herds in recent years. On Friday, analysts expect the USDA to report the number of cattle on feed on May 1 was down from a year ago.
CME June live cattle closed 1.5 cents higher at 182.975 cents per pound. August feeder cattle rose 1.35 cents to 259.825 cents per pound.
(Reporting by Tom Polansek; Editing by Alan Barona)
