Wild Oats XI led last year's second-place finisher Investec Loyal by up to 15 nautical miles on Tuesday but as the 100-footer sailed into an area of low pressure the wind fell away and its lead rapidly reduced.

On positions plotted at 8 p.m. AEDT (0800 GMT), Wild Oats XI led by only 3.6 nautical miles from Investec Loyal with around 260 miles to the finish line in the 628 nautical mile race.

Wild Oats XI had sailed into an area of light winds and though Investec Loyal was sailing faster, it was heading into the same light weather system as the yachts neared the island state of Tasmania.

The battle for line honors became a virtual two-boat race when the supermaxi Wild Thing withdrew from the race Tuesday with sail damage when running third.

The withdrawal of Wild Thing continued its unlucky run in the race. The 2003 line honors winner capsized in 2004, withdrew soon after the start in 2009 and hit a media boat at the start last year.

Wild Oats XI and Investec Loyal were left with a 30 mile lead over third-placed Lahana which was a further 31 miles ahead of fourth-placed Hugo Boss.

The contest for overall handicap honors was constantly evolving and at various times on Tuesday Wild Oats, Lahana, Wild Rose and Mondo held the outright lead.

Wild Thing's retirement was one of several withdrawals on Tuesday which reduced the fleet from 88 to 81 boats. Yachts and crews had been battered overnight by a southerly front that brought winds of up to 30 knots and rough sees.

Other casualties included Celestial, which broke the gooseneck that joins the boom to the mast, Accenture Yeah Baby with gear failure, Ffreefire with a mainsail problem and Duende with an injured crewman.

Duende pulled into Bermagui on the south coast of New South Wales state to allow injured crewman Tom Wormald to seek further treatment for a dislocated shoulder.

The leading yachts were now expected to reach the Derwent River, leading to the finish off Hobart, on Wednesday evening at the earliest. Wild Oats navigator Ian Burns said he was expecting a stretch of 50 to 60 nautical miles heading toward the Tasmanian coast with virtually no wind.

"Under five knots or so the boat can stop and it's very hard to get going again," he said. "That's the sort of opportunity that the guys from Loyal will be looking for.

"The boat behind has a whole bunch of options to go around either side. I can see those guys plotting and scheming all evening to put us in a tough spot." Investec Loyal Anthony Bell said he would try to out-think the race leader as he contended with minor damage to a reef line on his mainsail.

"We can only go to two reefs so it's slowing us down a little bit in the conditions," he said. "For now we're just trying to stay in contact with Oats.

"We think that if we stay in contact with them it will probably be more tactical by tomorrow."