Benchmark Australian spot thermal coal prices are up slightly from a week ago as a worsening backlog of ships waiting to load coal at the Newcastle port prompted traders buy more cargoes in the market to meet sales commitments.

Thermal coal, used for power generation, rose 65 cents from a week earlier to $51.65 per tonne, the globalCOAL NEWC index showed on Tuesday, based on free-on-board (FOB) prices loaded at Newcastle.

“Overall prices are pretty steady. There’s a little bit more activity because the infrastructure constraints at Newcastle port are delaying delivery, so people are buying more coal on the spot market to cover the sales they’ve got,” said a trader.

Coal exports at Australia’s Newcastle Port inched higher over the week, while vessel waiting time ballooned to more than 20 days — the longest in more than a year.

Long lines have been a feature at the port since November owing to maintenance work on rail tracks.

Newcastle Port data also showed coal shipments at the world’s biggest coal export terminal stood at 1.61 million tonnes, up 19,000 tonnes from the week ended Jan. 15, while coal ship arrivals declined by three to 18 ships.

The globalCOAL NEWC index, used as a benchmark for long-term contracts, has been trading firmly at above $50 in the last five weeks.

Industry sources said Australian coal miners, encouraged by rising demand from Asian utilities and supply constraints, were looking to raise Asian thermal coal contract prices in 2007.

Producers said they were aiming for between $54-$55 a tonne for thermal coal, compared with the benchmark export price of $52.50 a tonne in the shipping year to April 2007, based on Australian miner Xstrata’s XTA.L settlement with a group of Japanese utilities.

Australia is the world’s second-largest exporter of thermal coal after Indonesia, exporting 108 million tonnes in 2005, largely from Hunter Valley mines operated by Rio Tinto RIO.L(ASX: RIO.ax) and Xstrata.

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