* Feeder cattle finishes higher * USDA cattle reports at 2 p.m. CDT (1900 GMT) * Hog market settles flat to lower By Theopolis Waters CHICAGO, July 21 (Reuters) - Chicago Mercantile Exchange live cattle futures finished firmer on Friday, led by higher cash prices than earlier this week, traders said. Technical buying and futures' discounts to cash returns provided more market support. Investors were awaiting the U.S. Department of Agriculture's monthly Cattle On Feed report on Friday at 2 p.m. CDT (1900 GMT). The USDA will simultaneously publish the mid-year U.S. cattle inventory report. August ended 0.550 cent per pound higher at 116.425 cents and above the 10-day moving average of 116.340 cents. October finished up 0.325 cent at 117.400 cents. On Friday morning, market-ready, or cash cattle in Kansas and Texas brought $120 per cwt. That was steady with last week but up from Wednesday's $118 to $118.50 per cwt Fed Cattle Exchange sales. Remaining packer bids in the U.S. Plains were $119 to $120 per cwt, with sellers holding out for more money, said feedlot sources. "Packers need cattle. And this is as good as these sellers have felt in a long time as far as thinking they had the upper hand," said KIS Futures Vice President Lane Broadbent. Tight supplies and profitable packer margins underpinned cash prices this week, said traders and analysts. Seasonally slumping beef demand may soon bottom out as retailers buy meat for U.S. Labor Day holiday demand, they said. On Monday the USDA will issue the monthly cold storage report at 2 p.m. CST (1900 GMT) that will include total June beef and pork inventories. Two analysts surveyed by Reuters, on average, projected last month's total beef stocks at 401.8 million pounds and 544.8 million for pork. CME feeder cattle closed higher led by firmer live cattle futures and sharply lower corn prices. August feeders ended up 0.675 cents per pound at 152.950 cents. HOGS END FLAT TO LOWER Weaker cash and wholesale pork prices, along with technical selling, weighed on CME lean hogs, said traders. Investors sold deferred months and bought August based on its sizable discount to CME's hog index for July 19 at 92.00 cents. August closed unchanged at 81.100 cents per pound. October ended 0.625 cent lower at 67.225 cents, and December 0.975 cent lower at 61.975 cents. Both contracts settled below their respective 100-day moving average of 67.411 and 62.392 cents, respectively. Building seasonal supplies continued to pressure cash prices and wholesale pork values, a trader said.