Nelson said the ship was now being escorted to the northern city of Darwin.

He said Australia was also monitoring what he said was more than 140 suspected illegal fishing vessels operating in the Arafura Sea near northern Australian waters.

"We've got an eye on them, and the very clear message that I send to them on behalf of the Australian government ... is that you should at your own peril cross that exclusion zone," Nelson told Nine Network television.

"We will do anything and everything we can lawfully and diplomatically to not only discourage them but to intercept them," he said.

Nelson said he had asked the heads of the Australian Defence Force and the Navy to prepare options to support Customs and fisheries officials in the fight against illegal fishing.

"Under no circumstances should anyone from any other country think that they can just come here and take our fish and do it without suffering some impact," Nelson said.

"This is about the defence of Australia and we're not going to muck about," he said.

Last week, Australian authorities escorted the 75-metre (250-ft) freezer ship Chen Long into Darwin. Australian authorities say that the ship was carrying 639 tonnes of fish, of which up to 270 tonnes could have been caught illegally.

Eighteen Chinese crew from the Chen Long are being held at an Immigration Department facility in Darwin.

Australia intercepted a record 607 illegal fishing boats in its waters in 2005, more than double the number in 2004. It seized 280 of them, and confiscated the fishing gear and catch of the other 327.

Canberra says Indonesian fishermen venture into its waters in quest of lucrative shark fin because they have depleted their own stocks. Shark fin is a delicacy in Asia and can earn fishermen up to A$200 ($148) a kilogram.

Australia and Indonesia are already planning joint patrols to stop Indonesian fishermen illegally straying into Australia's northern waters. Indonesian police are planning to become more involved in investigating the vessels.