Hobart's Salamanca Market will close for the next two weeks, despite earlier assurances from the Prime Minister that open air markets would not need to close.

The weekly market has been operating every Saturday for almost 50 years and is a major tourist draw card among the state's most visited attractions.

City of Hobart General Manager Nick Heath said the precautionary measure had been taken after careful consultation with health authorities.

"This is a difficult time for everyone involved — not least of all the stallholders — and we make this decision with a heavy heart," Mr Heath said.

"However, it's a decision that we have made based on all the information available at this time."

He said while markets have not been included in current public gathering restrictions, it was not possible to implement proper social distancing.

"In the interest of health and safety of patrons, stallholders and staff, the markets will be suspended for two weeks, while we continue to take advice and monitor the changing environment around the COVID-19 response," he said.

Lord Mayor Anna Reynolds said the council was "deeply saddened at the need to take these sorts of measures".

"Salamanca Market is an iconic feature of our city and we want to ensure its longevity well beyond this current crisis," she said.

"We know there will be pain for businesses in the coming weeks and possibly months.

"This is an unprecedented situation and we don't yet know how deeply the impacts will be felt.

"This is where, as a community, we need to support each other as best we can. The most effective way to do that right now is to practise good hygiene, social distancing and any other protective measures to reduce the risk of the virus spreading through our city."

The initial closure of the market will be reassessed in two weeks time and at regular intervals after that.

One stallholder admits people are "shoulder-to-shoulder" on a busy Salamanca Market day. ( ABC News: Janek Frankowski )

Salamanca stallholder Alice Hansen said she while she was anticipating the decision, it was "bitterly disappointing" but necessary.

"It does have an impact, for me, as well as the majority of the others who rely on that weekly income," she said.

"To have that just cut off with fairly limited notice … is quite shocking."

She said in her 15 years at the market, she'd never seen it shut down like this.

"Even in the most crazy weather we've been down there. So it's a sad day, but understanding why that decision has been made," she said.

Ms Hansen said although the advice so far had suggested outdoor events were ok, she did not think it was feasible to practice social distancing at Salamanca Market.

"Most of the time on a busy market day, everyone's shoulder-to-shoulder, you can barely push a pram through there," she said. "It would be a haven for germs passing between each other."

She said the difficult decision to close "hopefully will reward us in the long term".

Hobart's Salamanca Market has been running since 1972. ( ABC News: Emily Street )

Agfest, Spiegeltent cancelled

Meanwhile, it was announced earlier on Wednesday that Tasmania's largest agriculture expo, Agfest, has joined the long line of events to be cancelled amid coronavirus concerns.

It is the first time the event has been called off in its 37-year history.

Agfest attracts more than 60,000 people on average, and injects more than $20 million into the state's economy.

Committee chairman Ethan Williams said the decision was not made lightly.

"It's a massive blow to Tasmania, along with everything else that's been cancelled over the last few days," he said.

The committee is confident the event will return next year.

Organisers of the Spiegeltent also announced it would no longer continue its season in Hobart.

The music, comedy, cabaret and circus opened on March 5 and was set to run until March 29.

"The Spiegeltent team will be in touch with ticket holders regarding ticket options as soon as possible," organisers wrote.

"Please bear with us, as you can imagine, we're dealing with an unprecedented number of inquiries and appreciate your patience at this time."