CHICAGO, June 25 (Reuters) - Chicago Mercantile Exchange lean hog futures set contract lows on Tuesday as traders prepared for the U.S. Department of Agriculture to report a slightly larger U.S. herd on Friday.

Analysts surveyed by Reuters project that quarterly USDA data will show the herd on June 1 was about 0.8% bigger than a year earlier and that the number of pigs per litter was up 2.3% in the March-May period.

Increases in the number of pigs per litter have offset herd reductions in recent quarters, said Rich Nelson, chief strategist for brokerage Allendale.

"We're quite concerned that might be the case again," he said.

CME July hogs closed 0.950 cent lower at 89.000 cents per pound and set a contract low of 88.800 cents. August hogs settled up 0.025 cent at 86.750 cents per pound. Other deferred futures contracts, including October and December, set new lows.

Cattle markets, meanwhile, were mixed, as strong boxed beef prices continued to underpin futures.

The USDA reported the choice boxed beef cutout at $323.39 per cwt, up $0.75 from a day earlier, and select cuts were up $0.19 at $305.26 per cwt.

"This relentless rally for boxed beef still continues," Nelson said.

CME August live cattle settled 0.400 cent lower at 184.425 cents per pound, after rising on Monday to the highest level since October. CME August feeder cattle ended up 0.150 cent to 250.050 cents per pound.

After trading ended, the USDA reported that total frozen U.S. beef supplies as of May 31 were down 3% from the previous month and slightly lower than a year earlier. Frozen U.S. pork supplies were down 3% from the previous month and down 9% from last year. (Reporting by Tom Polansek in Chicago; Editing by Pooja Desai)