Frontrunning Sydney to Hobart supermaxis Black Jack and LawConnect are going tit-for-tat in a tactical battle off Tasmania's east coast.
Sydney-based 100-footer LawConnect, a previous winner as Perpetual Loyal in 2016 and Investec Loyal in 2011, held a narrow two nautical mile lead at 10am (AEDT) on Tuesday having pushed past BlackJack.
Hong Kong's SHK Scallywag100, which led the fleet out of Sydney Heads on Sunday, is further back in third position.
Black Jack navigator Alex Nolan said conditions had been light early on Tuesday with a breeze of 10 knots.
"We are looking forward to a good day, to where we will end up this afternoon and evening," he said.
"Everyone is very well. Everyone is very happy. We are pushing it very hard."
LawConnect's position tracker has been malfunctioning, with its location determined instead by radio reports.
Cruising Yacht club of Australia commodore Noel Cornish expects the lead to change hands many times over the next 12 hours.
"It's now a tactical race. It was a survival race for a while. They were really just trying to get through that southerly, slowing their boats down to keep the yachts in place," he told the ABC.
"Now they're into a challenging navigator race. The tactics will be flat out."
This year's 628-nautical mile event is one of the slower races in recent memory, a long way behind Comanche's 2017 record of one day, nine hours, 15 minutes and 24 seconds.
Thirty-six boats in total have now retired from a starting field of 88 due to rough conditions caused largely by ocean currents.
Rouge Wave, a New South Wales entrant in the new two-handed category, was the latest to pull the pin after reporting unspecified damage on Tuesday morning.
More than a dozen boats were forced out of the race on Monday.
New South Wales-based No Limit retired on Sunday after a crew member suffered a broken arm, while others have reported a range of problems, including hull damage, electrical and engine issues and damage to rudders and sails.
Love & War and Smuggler, both from NSW, and Queensland's Fruit Salid 3 are among the handicap front-runners.
Tasmanian boat Sidewinder is leading the two-handed category ahead of nine remaining competitors.
© AAP 2021