Firefighters have contained an out-of-control bushfire in WA’s South West as police work to identify human remains which were found inside homes at fire-ravaged Yarloop.

An emergency warning remains in place in the shires of Harvey and Waroona, while a second fire poses a possible threat to lives and homes.

At least two people have been killed and another is missing as bushfires continue to burn out of control in western Australia, officials say. Police say the bodies of two men in their 70s have been discovered in the debris of burnt-out houses in the town of Yarloop, south of Perth.

An emergency bushfire warning remains in place for Yarloop.

Emergency services have warned that the towns of Harvey, Cookernup and Wokalup are also facing a big threat.

West Australia Premier Colin Barnett has declared the main area of the fire to be the scene of a natural disaster and eligible for emergency funds.

Residents and holiday-makers in the area – a major beef and dairy farming area – have been evacuated.

The inferno, sparked by lightning six days ago, burnt through 71,000 hectares (175,000 acres) in Western Australia state, leaving a trail of destruction, the latest in a series of summer blazes that have so far left eight people dead.

“The weather conditions are great today and they were in the last 24 hours so we have been able to essentially contain this fire,” Western Australia’s Emergency Services Minister Joe Francis told national radio.

“It’s not totally under control yet but we are very optimistic about the next 24 hours as well.” Alert levels have been downgraded from emergency to watch and act for towns in the area including Waroona, Hamel and Yarloop, a historic mill community some 110 kilometres (70 miles) south of Perth where two bodies were found in the blackened ruins of burnt-out houses.

The fire, one of the worst to hit the region in recent years, destroyed 143 properties, including 128 homes in Yarloop which was virtually flattened, the state’s Department of Fire and Emergency Services (DFES) said.

Western Australia’s state premier Colin Barnett has declared a natural disaster, giving residents access to greater financial support, with the Insurance Council of Australia estimating losses of at least Aus $60 million ( US $42 million).

The strong winds have now eased, but the fire remains unpredictable.