Cattle futures ended higher, as beef carcass cutout prices continued to firm and cash cattle traded higher, reported Reuters.

Cash cattle traded at $138-$140 in the Nebraska market on Tuesday, up from last week's trades at $135, said Rich Nelson, chief strategist for commodities brokerage Allendale.

"It looks like the three weeks of cash cattle declines are now over, and the market is reacting to that," Nelson said.

Wholesale boxed beef prices rose, with choice cuts up $1.21 at $265.87 per cwt as of Wednesday afternoon, according to US Agriculture Department (USDA) data. Select cuts were up, to $257.20 per cwt.

CME February live cattle futures settled up 1.325 cents at 140.725 cents per pound. CME March feeder cattle ended the session up 2.825 cents to 168.050 cents.

US hog future contracts rose as wholesale prices dropped. US pork carcass cutout prices fell by $2.60 to $84.29 per hundredweight (cwt) on Wednesday, USDA said. Ham prices rose $5.50 to $65.76.

Most-active February hog futures settled the day up 1.200 cents at 83.825 cents per pound. April hogs settled up 0.90 cent at 88.450 cents per pound.

Meanwhile, livestock traders said uncertainty over California's Proposition 12, which imposes new standards for animal housing, could create volatility in the hog market in coming weeks.

Among other things, the law requires farmers to give sows 24 feet of space in barns, and makes it illegal for businesses in California to knowingly sell uncooked pork that came from animals housed in ways that do not meet this requirement.

The changes are set to go into effect on 1 January. The measure is being challenged in court.

One key question, said traders, is pricing: how pork prices will change in California, and if the law will impact how wholesale pork cutout and cash hog pricing is calculated.