CHICAGO, Sept 22 (Reuters) - Live cattle futures on the Chicago Mercantile Exchange closed higher on Friday on tight U.S. cattle supplies and bargain-buying a day after the benchmark December contract hit a one-week low, traders said.

CME October live cattle futures settled up 2.100 cents at 187.075 cents per pound and most-active December ended up 1.850 cents at 191.350 cents. Both contracts hovered near life-of-contract highs set on Tuesday.

October feeder cattle futures settled Friday up 1.375 cents at 259.150 cents per pound.

After the market close, the U.S. Department of Agriculture in a monthly report said the number of cattle in U.S. feedlots as of Sept. 1 totaled 11.094 million head, or 97.8% of a year ago, near the average estimate among analysts surveyed by Reuters of 97.7%.

The USDA said August cattle placements into feedlots were 94.9% of a year ago, above the average trade estimate of 93.6%, and August marketings were 94% of a year ago, below the average trade guess of 94.7%.

Coming in relatively close to expectations, the USDA's figures looked fairly neutral for futures and reconfirmed that the number of cattle in feedlots remains smaller than a year ago after drought cut the size of the U.S. cattle herd, said Dan Norcini, and independent trader.

"From the (cattle) supply standpoint, it's certainly not burdensome," Norcini said. "Fundamentally, the supply is just so low that people want to keep buying (futures)," he said.

Managed commodity funds expanded their net long position in live cattle futures in the latest week, data from the Commodity Futures Trading Commission showed on Friday.

Wholesale beef prices firmed. The choice boxed beef cutout rose $1.40 on Friday to $303.33 per hundredweight (cwt), USDA data showed, and select cuts were up $1.43 at $280.43 per cwt. The week-to-date cattle slaughter totaled 612,000 head, down from 637,000 a year ago.

CME hog futures fell on Friday in what looked to be largely technical trade, Norcini said, with speculators booking profits after the benchmark December contract on Wednesday topped its 200-day moving average and set a 4-1/2 month high.

CME October lean hog futures settled down 1.425 cents on Friday at 81.525 cents per pound, and most-active December hogs fell 2.300 cents to finish at 72.175 cents.

(Reporting by Julie Ingwersen Editing by Shri Navaratnam)