Nov 24 (Reuters) -ICE cotton futures inched up on Friday, propped by a weaker dollar, but the natural fiber headed for a weekly loss after a U.S. report flagged a marketing-year low in weekly exports.

* The second-month March contract CTc2 rose 0.19 cent, or 0.2%, at 81.09 cents per lb at 12:28 pm ET (1728 GMT). It was set for a 0.6% weekly fall.

* The dollar index .DXY was down 0.4%, making cotton more attractive to buyers holding other currencies. USD/

* The U.S. Department of Agriculture's (USDA) weekly export sales report showed exports of 77,900 running bales (RB), at their lowest level in the 2023/2024 marketing year, down 31% from the previous week and 28% from the prior 4-week average. EXP/COT

* "It's just going to be quiet all day long, this will certainly be the lightest volume that we've had in the recent weeks just because of the holiday," said Jim Nunn, owner of Tennessee-based cotton brokerage Nunn Cotton.

* The USDA report also highlighted net sales of 322,200 RB for 2023/2024, down 2% from last week and 6% from the prior 4-week average. But China accounted for nearly three-fourths of the net sales.

* "China continues to buy cotton from Brazil since the prices are lower than in the U.S., and if the embargo on Australian cotton is lifted, it will be the next source, with the U.S. serving as the last resort," Nunn added.

* Cotton's planted area in Brazil was estimated to rise 14.9% year-on-year to 1.94 million hectares, while output was forecast to jump 16.4% to an all-time high of 3.74 million tons, agribusiness consultancy Agroconsult said earlier in the week.

Reporting by Sherin Elizabeth Varghese in Bengaluru; Editing by Shailesh Kuber