Prime Minister Anthony Albanese unlocked federal funds this week to cope with the Karenia mikimotoi algae as it persists four months after first appearing.

South Australia's government said it was holding an emergency meeting Tuesday to be briefed by scientists on the phenomenon.

The algae, which damages the gills of fish and suffocates them, stretched across 4,400 square kilometres (1,700 square miles) when it was first spotted in mid-March, according to the state government.

While South Australian authorities hoped the bloom would disperse, it has instead spread across the region, the latest government update said.

A marine heatwave in the area had "largely abated", it said, but remained in some deeper waters.

Beaches on wildlife-rich tourist draws such as Kangaroo Island, Yorke Peninsula and Fleurieu Peninsula have been littered with the marine carcasses of sharks, rays, crabs and octopuses.

"It's hard to overstate the extreme severity of the algal-bloom environmental crisis in South Australia," said marine ecologist Adriana Verges from University of New South Wales.

"We are talking about extensive mortality of nearly 500 different marine species, including key habitat-forming sponges and other invertebrates, as well as fish. It's completely devastating."

- 'Red flashing warning' -

Karenia mikimotoi has been detected around the world, including in waters off Japan, Norway, the United States and China, since the 1930s and disrupted local tourism and fishery industries, causing millions of dollars worth of damage.

Ian Mitchell, who manages a fish market in Adelaide, said some people had not caught anything since April.

"It's the worst I've ever seen it," he told national broadcaster ABC. "I'm speaking to fishermen on a daily basis, and I've got fishermen in tears on the phone."

The federal government announced on Monday Aus$14 million(US$9.1 million) in financial assistance to impacted fisheries, clean-up efforts and research into preparedness.

The prime minister said a "whole range of issues" had led to the event, including nutrient-rich floodwater runoff and above-average ocean temperatures.

Historically fishing and aquaculture industries can take years to recover from these algae blooms, said Australian Marine Conservation Society chief executive Paul Gamblin.

"It's an enormous red flashing warning that climate change has arrived off Australia and it is having enormous impacts," he told AFP.

South Australia has not previously experienced a toxic algae bloom of this scale or duration.

Local authorities have urged beachgoers to avoid swimming in water that is discoloured or foamy, warning that it can irritate the skin and affect breathing.

Climate change has led to an increase in the frequency and duration of marine heatwaves across Australia, which significantly affects marine ecosystems.