Most Chicago Mercantile Exchange live cattle contracts landed in negative territory on Tuesday after an up-and-down day of trading stirred by short-covering and uncertainty about near-term cash prices, traders said.

Spot December closed up 0.625 cent per lb to 122.250 cents per lb, February ended down 0.075 cent to 127.075 and April 0.400 cent lower at 128.050.

Market bulls believe fewer cattle will prompt packers to pay about the same for supplies as last week, but others said processor inventories are full after they booked animals ahead of time for later delivery.

A week ago, market-ready, or cash, cattle in the U.S. Plains moved at mostly $124 to $126 per cwt.

Monday and Tuesday's combined cattle slaughter was 224,000 head, 6,000 more than last week, based on U.S. Department of Agriculture estimates.

Some investors bought the December contract and simultaneously sold deferred months, led by the morning's wholesale beef price increase.

"A few supermarkets may be buying steaks, ribs and roasts while filling holes before Christmas, but that should change as shoppers concentrate more on holiday gift giving," a trader said.

Tuesday morning's wholesale choice beef price jumped $1.84 per cwt from Monday to $204.71. Select cuts rose 92 cents to $191.28, according to the USDA.

Soft deferred-month live cattle futures and a steep drop in cash feeder cattle prices knocked CME feeder cattle contracts to fresh lows.

January ended 2.600 cents per lb lower at 153.850, after posting a new low of 151.950 cents.

MOSTLY HIGHER HOGS SETTLEMENT

Short-covering and fund buying underpinned all CME lean hog contracts except thinly traded December, which was pressured by lower cash and wholesale pork values, traders said.

Spot December which will expire on Dec. 14, closed 0.150 cent per lb lower at 55.325 cents, February 0.850 cent higher at 58.375 cents and April up 0.700 cent to 62.350.

Cash hogs in the Midwest on Tuesday morning sold steady to down 50 cents per cwt from Monday after packers bought enough supplies for the rest of the week, regional hog buyers said.

Tuesday morning's wholesale pork price slumped $3.32 per cwt from Monday to $70.57, racked by the respective $16.20 and $7.61 plunge in costs for pork bellies and hams, the USDA said.

"Ham processing is likely done for the year-end holidays, and bellies for storage have lost value amid plentiful supplies of fresh product," said Linn Group analyst John Ginzel.

Read more at Reutershttp://www.reuters.com/article/usa-livestock-idUSL1N13X25A20151208#6tQB3...