PRINCE RUPERT, British Columbia — With a U.S.-Canada trade war raging, Canada fired a warning shot on its northwestern front — one that could have repercussions for Washington state’s trade-dependent economy.

Some 200 decision-makers from across the Canadian shipping, commodity and energy industries traveled to this remote corner of British Columbia for the Aug. 27 grand opening of Prince Rupert’s CANXPORT, a new facility that moves bulk products from railcars into containers for export on cargo ships.

The ports of Seattle and Tacoma have cast a wary eye at Prince Rupert because of its strategic location, 36 hours closer to Asia than Puget Sound by ship. Over the last two decades, the sleepy town along the Inside Passage has become a global hub for containers headed to North America.

In 2020, Prince Rupert handled more cargo than the Ports of Seattle and Tacoma — which operate jointly as the Northwest Seaport Alliance — for the first time. That trend could accelerate with the opening of the $541 million export facility.

CANXPORT debuts at a pivotal moment for Canada.

Trade talks between Ottawa and Washington, D.C., broke down Aug. 21, with President Donald Trump imposing 50% tariffs on a range of Canadian imports. Prime Minister Mark Carney’s reciprocal Canadian tariffs are scheduled to go into effect Tuesday.

Canada is building at a dizzying pace to meet a goal of doubling non-U.S. exports in the next decade and the CANXPORT facility is a shiny new tool in Canada’s commercial arsenal that could have big implications across the border.

“The world needs strong, stable, reliable trading partners,” British Columbia Transportation Minister Mike Farnworth said at the grand opening last month, saying “we have uncertainty geopolitically” amid “issues with our friends and neighbors to the south.”

“That’s what Canada is,” Farnworth said, “and that’s the future of this project and the Port of Prince Rupert.”

Canada’s leading edge

On a patch of industrial land the size of 82 American football fields, surrounded by rain-forested hillsides and pebble-strewn beaches, containers were stacked five high outside a cavernous white structure at the CANXPORT site on Aug. 27.

Canadian National hopper cars parked alongside the structure, connected to vacuum pipes that sucked out polyethylene resin pellets from a Dow Chemical plant in Alberta. There’s high demand in Asia for these pellets, a byproduct of natural gas extraction used in everything from food packaging and water bottles to phone cases.

Inside the structure, the scene was like Willy Wonka’s plastic pellet factory: Assembly lines whirred as automated machines loaded 55-pound bags and stacked them on pallets for a waiting forklift driver.

Assembly lines at the plastic pellet export hub run 24/7. Other areas at the facility will export lumber and pulp, while future phases could export food and potash — a key fertilizer ingredient.

Prince Rupert banks on proximity to compete with West Coast ports for inbound business from Asia.

At the Port Interpretive Center on Prince Rupert’s waterfront, where tourists cruising from Seattle to Alaska stop for whale-watching and grizzly-bear tours, an electronic map highlights how much closer Prince Rupert is to the ports of Tokyo and Shanghai than West Coast ports farther south. A red spider web on the map shows the rail connection from Prince Rupert to Chicago, the freight and logistics hub of North America.

Canadian National “offers reliability, speed and the flattest rail grade of any West Coast port,” the map brags, below a banner that declares Prince Rupert as “Canada’s leading edge.”

Once a fishing town, Prince Rupert didn’t open a container terminal until 2007. But last year, the town of 13,000 moved 26.3 million metric tons of cargo — more than the twin Puget Sound ports home to millions of people.

Both are dwarfed by the Port of Vancouver, which moved a record 170.4 million metric tons of total cargo in 2025. Together, these two Canadian West Coast ports are eating away at the Northwest Seaport Alliance’s market share: From 2006 to 2025, cargo growth rose 103% in B.C. and dropped 22% in Seattle and Tacoma, according to the Pacific Merchant Shipping Association, a trade group serving U.S. West Coast ports.

For Kurt Slocombe, CEO of Prince Rupert Port Authority, CANXPORT will further bolster the port’s attractiveness to shippers.

We believe the export side of the business will actually drive the import volume up, because they'll have to bring in more containers so they can take back the exports.

A tale of two strategies

CANXPORT is the first piece of a broader $2.17 billion investment in the Port of Prince Rupert, with a goal of doubling trade volume over the next decade.

Meanwhile, the Port of Vancouver’s long-planned Roberts Bank Terminal 2, less than a mile north of the Washington border in Delta, B.C., was promoted to Canada’s Major Projects Office in July. This proposed expansion would increase the Port of Vancouver’s capacity by 50%, and the vote of confidence suggests the Canadian federal government will steer the project through environmental objections and First Nations concerns.

Looking at Canadian federal investments in its West Coast ports, Patrick Gallagher admits he’s “a little jealous.”

“They have turned a corner and made a decision that they are no longer playing defense,” said the executive director of Marine Exchange of Puget Sound, a Seattle-based trade group that tracks vessel movement and shipping data. “They understand the value of their port infrastructure and they know it’s a foundational piece to their prosperity.”

Gallagher contrasts Canadian trade policy with the U.S. approach. While the White House issued an executive order in April 2025 “Restoring America’s Maritime Dominance,” it focuses more on shipbuilding than port infrastructure. Congress has yet to pass a proposed National Maritime Strategy, although some elements were incorporated in the defense bill passed in July.

A 2021 study commissioned by the Northwest Seaport Alliance and California ports found that B.C. ports received more than eight times as much investment from 2016 to 2020 as their Washington counterparts.

The U.S. is less centralized, with domestic ports competing for investment and business. Shippers choose which gateway to use based on a complex calculation that factors in price, fuel costs, speed, reliability of rail or trucking connections, and more.

Sometimes it’s cheaper or faster to send a ship from Asia through the Panama Canal and unload at an East or Gulf Coast port. Sometimes a significant amount of cargo is destined for Southern California, so Long Beach is a no-brainer. Oftentimes Prince Rupert and Vancouver offer the best prices.

Rarely is Seattle-Tacoma the winning bid on cost alone.

“Rupert stole quite a bit of our container traffic,” said Port of Seattle Commissioner Fred Felleman, who estimates the B.C. ports save shippers $300-500 on the average $5,500-8,500 price tag to ship a standard container from Asia through Seattle/Tacoma to a final North American destination. “We’re never going to be the cheapest date in town, but we’re trying to provide more efficiency and better customer service.”

Some shippers at the CANXPORT grand opening disputed the notion that cargo business is a zero-sum competition.

The new facility could help “grow the pie,” said Amine Dounnajah, chief commercial officer for CMA CGM Canada, and encourage additional sailings on routes that include Seattle/Tacoma port calls in addition to Prince Rupert and Vancouver stops.

And the Northwest Seaport Alliance can tout a number of recent improvements.

Since 2019, the Port of Seattle has invested $500 million to modernize Terminal 5, and in April, U.S. Sen. Patty Murray, a Washington Democrat, announced over $10 million for shore power and waterway deepening. At the Port of Tacoma, Korean company HMM Shipping Line said in July that it will spend $135 million on its terminals to increase capacity by 50% by 2030.

Structural drawbacks remain, like the fact that all shippers to U.S. ports pay the Harbor Maintenance Tax, something they can avoid by unloading in B.C. At $1.25 for every $1,000 worth of cargo, the tax may not always be the deciding factor, but every additional cost puts Seattle and Tacoma at a competitive disadvantage.

“What would you do,” asked Gallagher of the Marine Exchange of Puget Sound, “if you came into the Strait of Juan de Fuca and had to pay a toll if you turned right (toward Seattle/Tacoma) but not if you turned left (toward Vancouver)?”

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