Detectives are searching for an additional 200 kilograms of cocaine after saying they only found "a portion" of the shipment near a diver's body in Newcastle.
Police suspect the man was trying to collect up to 300kg of drugs from a bulk carrier when he drowned.
The shipment has an estimated street value of $120 million, but only $40m worth has been seized from the vessel and the surrounding area.
Investigators have now identified the man – originally from South America – and suspect he travelled illegally to Australia before the boat arrived.
Organised Crime Squad Commander Detective Superintendent Rob Critchlow said the investigation was progressing strongly.
"I can confirm it appears to be a lot more than what has been retrieved from the ship," he said.
"Investigations are going very, very well — it appears that the amount we [originally] found was just a portion of what was actually brought in on the ship."
When the man's body was pulled from the water, 50kg of cocaine were found in a nearby bag.
Police divers spent the day scouring the ship for evidence and have seized another 50kg of white powder.
Detective Superintendent Critchlow fears some of the cocaine may have already made it to the street.
"We have information indicating that more drugs have been retrieved by this group and are now at large in the community," he said.
The International Transport Federation told the ABC all the members of the ship's foreign crew had been interviewed and cleared.
The ship is registered in the Marshall Islands, located between Australia and Hawaii, and is expected to depart for Argentina next week.
Some of the drugs are believed to have been attached to the hull of the ship.
Detective Superintendent Critchlow said it was appalling that the diver had apparently been left to die.
"It is pretty awful, really, regardless what the fellow may have been up to," he said.
"We are obviously keeping an open mind and to be obviously be distressed to the point where he lost his life is really quite horrible."
Investigators are looking into whether the man had connections to a global drug syndicate.
Newcastle is home to the world's biggest coal port and sees more than 2,000 ships come and go each year, most loaded with coal close to where the cocaine was discovered.
'Left for dead'
Police were called to Heron Road on Kooragang Island on Monday following reports of an unconscious diver on the shore.
Despite the efforts of members of the public and paramedics the unknown man died at the scene.
Earlier, Detective Superintendent Critchlow said there were "evidently more people involved than the dead man" due to the complex nature of scuba diving.
"The presence of two boats indicates at least two other people, so very concerning that this man has been left for dead, basically," he said.
"[The victim was] either left to die, or when he did die these people fled.
"So it's quite disgusting that this man has been left to die regardless of what he has been involved with."
He said the man still has not been identified despite a search of Australian records and systems.
Port officials were the first to notice someone floating in the water.
"It was clear he was wearing dive equipment and some pretty specialised equipment," he said.
That includes a rebreather, which allows people to stay underwater for a long period of time without giving off bubbles.
Superintendent Critchlow said police had confirmed the substance was cocaine.
"It was packaged up in a way that appeared to be brought from overseas," he said.
Suspicious activity
Police are urging locals or anyone with information to come forward after reports of unusual activity on Sunday night.
Superintendent Critchlow said the suspicious activity was around Berth Two on Heron Road, Kooragang Island, on the south arm of the Hunter River.
The ship Areti.GR was moored nearby and had travelled to Australia from Argentina carrying soy bean powder.
Superintendent Critchlow said two smaller vessels were also spotted in the area on Sunday night.
"A small rubber ducky and a 5-metre aluminium Quintrex runabout with a green stripe was seen also near the ship," he said.
