Chicago Mercantile Exchange live cattle on Tuesday reversed some of their recent losses, helped by short-covering and futures' discounts to this week's expected cash prices, said traders.

They said some investors sold June futures and simultaneously bought deferred months ahead of the first notice day for June cattle deliveries on Monday.

June ended up 0.275 cent per pound to 122.975 cents, and August 0.900 cent higher at 119.850 cents.

Some processors intend to build inventories for next week, which is the first full week of production after the Memorial Day holiday, said traders and analysts.

A trader said other packers may have bought enough cattle in advance of Monday's holiday for delivery over the next week or two.

Overall, packers may try to avoid actively competing for supplies if grocers heavily promote pork and chicken after National Beef Month in May wraps up on Wednesday.

Market participants await Wednesday morning's Fed Cattle Exchange sale of 2,067 animals. The average top price there last week was $132.54 per cwt.

A week ago packers in the U.S. Plains bought slaughter-ready, or cash, cattle for $132 to $133 per cwt. Cash cattle there a week earlier fetched $133 to $134.

Tuesday morning's average wholesale beef price slipped 37 cents per cwt to $245.23 from Friday. Select cuts rose $1.39 to $219.84, the USDA said.

Higher live cattle futures and lower corn prices rallied CME feeder cattle by almost 2 percent. August feeders ended 2.975 cents per pound higher, or up 1.97 percent, to 149.925 cents.

Hog Futures Retreat

Soft cash prices and profit-taking, after contracts spiked to new highs last Friday, undercut CME lean hogs, said traders.

June led declines after investors sold that contract and at the same time bought deferred months in a trading strategy known as bear spreads.

June closed 1.325 cents per pound lower at 80.500 cents, and July down 0.900 cent to 81.000 cents.

Tuesday morning's average cash hog price in the western corn belt was $71.91 per cwt in extremely light volume, down 32 cents from Friday, USDA said.

A few packers bought enough hogs for the rest of the week, but others might need supplies for a big post-holiday Saturday kill, a trader said.

Solid packer profits, good pork demand and seasonally declining supplies are incentives for processors to raise cash hog bids in the near term, he said.