CHICAGO (Dow Jones)--Chicago Mercantile Exchange hogs closed mostly weak Friday on sell stops, December/February bear spreading tied to pre-weekend position squaring and market uncertainty heading into next week.

Pork bellies settled lower. Live cattle ended firm. And, feeder cattle closed higher.

Lean hogs slipped at first after those who were recently long the market took profits. December and February overbought technical indicators and their bearish premiums to CME's hog index put traders in a selling mood.

Market participants were unsure how to trade December which is not directly affected by current market fundamentals because its expiration is two months away.

And, there was uncertainty about how the reallocation of positions by Deutsche Bank from grains to livestock will impact lean hogs next week. The shift is scheduled to begin on Oct. 19 and finish by the end of October.

Lean hog traders on Monday could adopt a wait-and-see attitude given ambiguity surrounding the market.

Cash hog prices on Friday came in steady to weak. The same is expected cashwise on Monday as processors draw from plentiful supplies.

The pork cutout situation could become tenuous given daily hog slaughters consistently above 430,000 head.

And those in the hog pit who also trade CME live cattle await results of the federal government's Friday afternoon cattle report.

December hogs ended down 37 points at 54.10 cents a pound. February finished up 10 points at 60.80 cents. April closed down 12 points at 65.42 cents.

Pork bellies closed lower on leftover selling after futures' fell Thursday, lean hogs' tumble and sell stops linked to technical support loss.

February pork bellies ended down 40 points at 81.85 cents, and March ended down 55 points at 79.50 cents.


Cattle Complex


Live cattle landed in mildly positive territory on encouraging cash cattle price news and buy stops. Also, those who were short the market covered positions before the U.S. Department of Agriculture's monthly cattle-on-feed report on Friday at 3 p.m. EDT.

The following are analysts' estimated averages and range of estimates for the upcoming report:

Average Range
of estimates of estimates
On-feed in Oct 100.3 99.0-101.2
Placed in Sep 105.5 102.6-109.4
Marketed in Sep 97.8 96.0-99.3
Cash-basis fed cattle Friday afternoon moved at $83 per hundredweight, which is an improvement considering fed cattle earlier in the week ranged from $78 to $82. Fed cattle last week brought $79 to $82.

Midday boxed beef firmness helped pull October up from initial lows that were driven by bullish traders who lightened some of their positions in preparation for Friday's USDA cattle numbers.

The U.S. government's Friday afternoon boxed beef data showed choice cuts up $0.47 per hundredweight, and select cuts gained $0.69.

Live cattle traders on Monday will take into account Friday's federal government cattle report outcome and look ahead to next week's cash trade.

Cattle market participants will continue to track CME information for possibly more deliveries.

And as is the case with their lean hog brethren, live cattle players eagerly await how Deutsche Bank's commodities reallocation process early next week will affect cattle contracts.

October live cattle settled up 30 points at 84.10 cents, and December closed up 15 points at 85.80 cents.

Feeder cattle ended higher on live cattle's late-day run up, buy stops and spreaders who bought feeder cattle and sold live cattle.

Speculative bullish feeder cattle traders were also drawn to CME's rising feeder cattle index.

October feeder cattle settled up 42 points at 94.55 cents, and November closed 52 points higher at 95.12 cents.

-By Theopolis Waters; Dow Jones Newswires; 312-341-5778; theopolis.waters@dowjones.com