Bunbury has not been included on Westport Taskforce's shortlist of future port and supply chain options.
The shortlist was set up to manage WA's growing container freight requirements.
Three standalone options for Kwinana and two shared options for Kwinana/Fremantle made the cut.
The five shortlisted options performed the best in relation to the taskforce's multi-criteria analysis process.
Westport Taskforce independent chair Nicole Lockwood said there were several reasons as to why Bunbury was left off the list.
"We analysed each of the options against a range of criteria. For Bunbury, the key inhibitors revolved around the depth of the port," she said.
"Distance was also a problem, because only 3 per cent of containers coming in at the moment are destined for Bunbury.
"As a standalone option or a large-scale shared option, Bunbury was not able to perform in the same way as the other locations."
Despite leaving Bunbury off the shortlist, Westport has identified other opportunities to grow industries and expand the port.
"In its conversations with local stakeholders and industry, Westport saw a number of opportunities that could lead to long-term economic and social development for the region," Ms Lockwood said.
"Westport handed its findings to the Department of Transport, which will now work with stakeholders including Southern Ports, government agencies, industry and economic development organisations to plan the next steps."
Bunbury Geographe Chamber of Commerce and Industry vice president Rob Skipsey said they were looking forward to seeing the port reach its full potential.
"The most recent announcement is disappointing for the port and for the Bunbury-Geographe region," he said.
"However, I don't think it closes the door entirely for Bunbury.
"There is now an opportunity for the Bunbury Port and our industries to look at building upon the region's capabilities."
Ports Minister Alannah MacTiernan and Transport Minister Rita Saffioti praised the taskforce for helping to improve the state's economy.
South-West MLC Dr Steve Thomas said the Westport review reinforced the government's low priority for the Bunbury Port.
"Of the 23 options, the four options for development of the Bunbury Port ranked 20 to 23 on the shortlist," Dr Thomas said.
"It would have been better for the taskforce and the McGowan Government to be honest from the start and let us know that Bunbury was never in the hunt."
Details about the shortlist are available at mysaytransport.wa.gov.au/westportbeacon
