Australia's Foreign Minister Senator Bob Carr has welcomed news an Australian man held hostage for more than a year in the Philippines is alive, but says his prolonged captivity is of major concern.

Warren Richard Rodwell, who was abducted on Dec 5 last year by armed men in the southern Philippines, has appeared in a video as proof he is alive, the Australian Associated Press reports.

On the recording, Rodwell said he was kidnapped by the al-Qaeda-linked group Abu Sayyaf and was being held in isolation.

He understood negotiations were under way for his release, but said he held no hope of ever being released.

Carr said the Philippines government was leading the response to the case and had devoted significant resources to securing Rodwell's release.

"We are also in regular communication with Mr Rodwell's family," Carr said in a statement on Thursday.

"It would not be helpful to Mr Rodwell to comment further."

A spokesperson for the Department of Foreign Affairs and Trade also said it would not be in Rodwell's interests to elaborate on details of the case of its handling.

Philippine intelligence officials said on Wednesday they believed the video, circulated on YouTube, was authentic.

In it, Rodwell held a copy of a local newspaper dated Dec 15 and said the recording was made the following day.

The kidnappers demanded an initial ransom of US$23,000 from his wife, with who runs a store in a seaside town on Mindanao island in the country's south.

According to police, Rodwell's wife said she had no way of raising the ransom.

The Australian government advises Australians against travelling to central or western Mindanao, where it warns there is a danger of kidnapping.