Hopes are fading for about 100 people missing after a ferry disaster in the Pacific island nation of Kiribati.

About 100 people were believed to have been on board an overloaded wooden catamaran when it broke up and sank soon after it set out on a 240-kilometre inter-island journey on January 18.

Planes from Australia, New Zealand and the United States have been scouring the ocean west of Kiribati looking for survivors.

Paul Craven from New Zealand's Rescue Coordination Centre told ABC's Pacific Beat there has been no sign of them today.

"We have located a bit of flotsam and jetsam but it's very hard to tell whether its come from the vessel," he said.

A fishing boat rescued seven survivors found drifting in a dinghy on Sunday.

A military Orion plane found survivors aboard a small dinghy. ( Supplied: NZ Defence Force, file photo )

Mr Craven said the survivors have said people scrambled onto two dinghies and a life raft when the ferry sank.

"Unfortunately one of the dinghies was then seen to capsize and we think, it's a bit difficult with some of the language, but it looks like that dinghy's sunk," he said.

"So we've obviously rescued one dinghy and so we're very interested now in the life raft and its location."

Mr Craven said the seven survivors were in reasonable health.

"Kiribati has sent one of their patrol vessels out with two doctors and four nurses on board to A; pick up the survivors and render medical assistance, but also so they have a medical team out there should we find further survivors," he said.