Police divers have recovered the body of a snorkeller missing off the Hunter coastline after going diving for lobsters on Sunday.

Scott McGuire, 29, had not been seen since entering the water off Birubi Beach at Anna Bay.

Scott McGuire was searching for lobsters off Birubi Point at Anna Bay on Sunday afternoon when he failed to return home.

Despite a large scale search by authorities, it was a fellow snorkeller who discovered Mr McGuire's body at the popular diving spot late on Wednesday afternoon.

It appeared Mr McGuire drowned after getting an arm stuck between rocks while trying to retrieve some lobsters.

Loading

There had been fears that the local man may have been taken by a shark, and a helicopter involved in the search saw at least seven large great white sharks less than one kilometre off the coast on Wednesday morning.

Police divers returned to the scene on Wednesday night and retrieved the body as relatives watched from shore.