Australia Weather News

A tornado has been observed in central New South Wales, with a severe weather warning issued for the area.

The Bureau of Meteorology (BOM) confirmed the tornado occurred north west of Young about 3:30pm.

The State Emergency Service (SES) also issued a watch and act alert and asked people to stay indoors in those areas.

The tornado warning has since been cancelled, but the BOM said severe weather was still likely and that there was a risk of hail, damaging winds and heavy rain.

NSW RFS inspector James Morris said the tornado was spotted about 3:30pm.

"The Rural Fire Service fire tower cameras picked up what was believed to be a very significant weather cell building to the north-west of Young, around [an area] called Tubbul," he said.

"That camera picked up the cell, which was then sent through directly to our fire behaviour analyst team through to the Bureau of Meteorology, which we believe provided notification and warning of what we believe would be a tornado cell forming in in that area."

Mr Morris was unable to confirm how long the tornado lasted, but said the early indications were that it was not very destructive.

"At this stage, there's no reports of any injuries or significant damage," he said.

"However, given that that cell is still moving through the area, we will hopefully see … whether emergency services do receive any further calls for assistance."

Industrial explosion

Meanwhile, the rain is being blamed for an industrial explosion at the Port Kembla Steelworks.

BlueScope Steel said the wet weather caused a reaction at the basic oxygen steelmaking plant's slag-pit and created a steam explosion about 4pm. 

The noise of the explosion was heard by residents in suburbs up to 20 kilometres away.

Residents closer to the blast told the ABC they felt their windows shake.

BlueScope Steel confirmed no-one was injured and that there was no significant damage to equipment.

No evacuations were necessary, the steelmaker said.

BlueScope will launch an investigation into the incident.

Hikers rescued

That incident followed a group of bushwalkers becoming stranded in the Royal National Park as river levels rose.

The group of three got trapped between two rising streams at Wattamolla about 1pm.

SES teams used a raft to access the area and transported the hikers to safety.

The SES said it had responded to 30 jobs in Wollongong in the last 24 hours, mostly involving leaking roofs and fallen trees.

South East Duty Zone Commander Matt Price said the wet conditions were expected to continue into the early hours of Thursday.

"It will ease in the inland side and get heavier falls overnight between midnight and 4am before the low pressure [system] moves offshore to the east," he said.