Dec 7 (Reuters) -ICE cotton futures hit their daily upper trading limit and a five-week high on Thursday after a weekly federal report showed strong U.S. exports for the natural fiber, while a weaker dollar lent further support.

* The front-month March contract CTc1 rose 4 cents, or over 5%, to 82.75 cents per lb by 10:49 a.m. ET (1549 GMT), staying on track for its best session since November 2022.

* The U.S. Department of Agriculture's (USDA) weekly export sales report showed exports up 57% from last week at 139,200 running bales (RB) even as net sales dropped 46% to 116,400 RB. EXP/COT

* "It doesn't have to be the most bullish report you have ever seen to just be a catalyst when the market is smoldering," said Jon Marcus, president of Lakefront Futures and Options brokerage, in Chicago.

* Half of the net sales and around 40% of the exports were to the world's biggest cotton consumer China, the report showed.

* "A country of that size, regardless of any economic news that they put out for us to digest, is always going to be in the market. They're always going to be buying," Marcus said referring to China.

* The U.S. dollar .DXY dipped 0.4%, making U.S. cotton more attractive for buyers holding other currencies. USD/

* Certified cotton stocks on Tuesday fell to 6,325 bales from their highest level in over two years at 87,770 bales on Dec. 1, according to ICE data.

* In the wider agricultural market, ICE cocoa futures rallied back towards record highs while Chicago wheat futures held steady near a four-month high. SOF/L GRA/

* Investors await the release of the USDA's World Agriculture Supply and Demand Estimates (WASDE) report due on Friday.

* Meanwhile, Brazilian crop agency Conab lifted its forecast for Brazil's 2023/24 cotton production to 3.061 million metric tons from 3.039 million tons in November.

Reporting by Deep Vakil; Editing by Shinjini Ganguli