Mystery smoke! Help please...

Right, I've removed back box itself after some cutting and grinding (rotten flange bolts)...

I can safely say there was a reasonable amount of water in the back box... doesn't really smell of anything to be honest, bit fumey.. Not really dirty, slightly grey but still has clarity to it. 

still steam coming from the rest of the exhaust with engine running and puffs up a bit with a rev. 
But as mentioned if it's been trapping for a while and not getting used enough there could be a fair amount in the system. Had a good quart of a teacup full out the backbox and can still hear a decent amount sloshing round in there but cant get it to come out no matter which way I shake it.

previous owner reported  no smoke issues but also didn't get up to much with the truck either in terms of putting it through it's paces.

Will have a check around for more leaks further up the pipe flanges 

Caught excess liquid coming out of remaining exhaust and it's clear, smells slightly fumey, slightly metally... the same smell you get rinsing dirty metal components in your kitchen sink with warm water while your Mrs shouts at you for making a mess. 

Although without the back box on it sounds like a v8 tractor you can still hear water being bubbled and gargled in the pipe.. could be section behind or in front of transfer box. 
Had a feel around and there is a slight blow from the first flange and downpipe... so could be an entry point when wading.

yes I have extended diff breathers but surely if those pipes were condensing on them it would be my axle oil that would have water in... Not my exhaust pipe?? Or am I missing something daft.

And this is why I avoid water deeper than the bottom of my wheels.

Yes I understand there's always a risk and a safe wading limit!
However my previous jimny also snork'd, lifted and axle breathers used to get dunked up to the bonnet on a regular basis (axle oil dumped and changed regularly) and never had a single issue with exhaust holding water or white smoke.

I didn't buy/build it to avoid water and wet mud... I'd rather enjoy it and maintain it regularly instead.

However, this is a new one to me hence me starting a thread to ask the question

Absolutely it's what they are designed for. I have had other 4x4s with water over the top of the bonnet without a snorkel but in those days cars were recreational as I could walk to work nowadays I rely on my Jimny daily on my farm to keep the operation running so it colours the assessment of risk.

Yes if your lively hood is at stake I more than agree with not risking damaging your jim