Afghanistan produces over 90 percent of the world's opium, the raw ingredient for making heroin.
"By year end, warlords, drug lords and insurgents will have extracted almost half a billion dollars of tax revenue from drug farming, production and trafficking," Costa said in a summary of the U.N.'s annual Afghanistan opium survey, published Thursday.
"Not surprisingly the insurgents' war machine has proven so resilient, despite the heavy pounding by Afghan and allied forces," Costa said.
The figures are a worrisome sign for the U.S. and NATO commanders who have long insisted that there is a direct link between the insurgency they are fighting and the booming drug trade, especially in Afghanistan's south.
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The potential profits are dramatically higher than the $100 million that the Taliban is believed to have received last year from the multibillion-dollar trade.
In a sign that the military alliance sees the drug trade as a strategic threat, NATO defense ministers authorized their troops in Afghanistan last month to attack drug barons deemed to be supporting the insurgency.
The U.N. report said production of opium dropped by 6 percent in 2008 to 7,700 tons, cultivated by 1 million fewer farmers than in 2007. Its export value is estimated at $3.4 billion, it said.
The area under cultivation also dropped by 20 percent from 2007 to 388,000 acres (157,000 hectares), virtually all of it in Afghanistan's south and west, where the Taliban-led insurgency is the most active, the report said.
Costa noted that Afghan opium production has exceeded world demand for a number of years.
"The bottom should have fallen out of the opium market. It has not," he said.