CHICAGO, Feb 14 (Reuters) - Chicago Mercantile Exchange hog futures rallied on Wednesday on recent strength in cash prices, while cattle futures fell in a setback from multi-month highs reached this week, according to analysts.
Lean hog futures have recovered since the start of the year, after the front-month contract set a three-year low on Jan. 3.
Higher hog prices were tightening margins for pork processors on Wednesday, brokers said. Meatpackers had estimated margins of $28.55 per hog, down from $38.25 per hog on Tuesday and $34.25 per hog a week ago, according to livestock marketing advisory service HedgersEdge.com.
Traders also were digesting weekly U.S. data that showed hogs in Iowa, southern Minnesota and South Dakota on average weighed 288.7 pounds in the week ended Feb. 10, down from 290.8 pounds a week earlier.
CME April lean hogs settled up 3.450 cents at 84.525 cents per pound and hit their highest price since Feb. 1.
April live cattle futures closed 1.100 cents lower at 184.000 cents per pound on Wednesday. The contract reached its lowest level since Feb. 6 after rising on Monday to the highest price since Nov. 3.
March feeder cattle fell 1.775 cents to finish at 246.225 cents per pound. The contract hit the lowest price since Feb. 6 after rising on Monday to the highest price since Oct. 19.
"Cattle has been pretty well overbought," a broker said. "We're due for a correction there."
In other news, U.S. Agriculture Secretary Tom Vilsack said there will be chaos in the U.S. meat marketplace without congressional action on California's Prop 12 law that tightened animal welfare requirements for pork products sold in the state.
(Reporting by Tom Polansek in Chicago; Editing by Sherry Jacob-Phillips)
