A four-alarm chemical fire broke out at Port Metro Vancouver, one of Canada's busiest ports Wednesday, forcing hundreds to stay indoors for several hours as fire crews battled the heavy smoke and fire.

The city and health authorities shut down parts of the downtown core and told residents to stay indoors to avoid exposure to the toxic cloud.

“The fire burning in a single shipping container at the Centerm Container Terminal on the south shore of Burrard Inlet is now considered under control, and the resulting smoke continues to diminish," Port Metro Vancouver said in an emailed statement.

Shortly after 6 p.m. PT, Vancouver fire officials said the order to stay indoors was lifted, but still encouraged people to stay away from the affected area.

Vancouver Coastal Health said trichloroisocyanuric acid, a hazardous organic compound that can be used as an industrial disinfectant, fuelled the fire at the container terminal.

Vancouver fire Assistant Chief Dan Wood said the chemical is an oxidizer, which means it produces oxygen and adds to a fire.

"In this situation it was either contaminated or disrupted, so it heated up and caught fire," Wood said.

Watch raw video of the fire

Port evacuated, health concerns

Smoke from the fire was foul-smelling and irritating to the eyes and lungs.

"I drove right through the cloud and it smelled horrible. It was one of the worst smells I ever smelled," said Matthew Bowcott, who works by the docks. "It's almost like a sulphuric smell, something chemical."

"My eyes were watering and it definitely irritated my chest and my lungs."

John Parker-Jervis, a spokesman for Port Metro Vancouver, said the terminal was shut down and employees sent home. The port's operations on the south shore of Burrard Inlet were also shut down, including railway and truck access.

According to Vancouver fire assistant chief Ron Coulson, firefighters got the call around 1:40 p.m. PT. The fire started in one of the large containers "buried deep within the pile of containers that are normally stacked up here at the dock," Coulson said.

Once the fire is dealt with, an investigation will begin into its cause.

Transport Canada said in an emailed statement that it takes all incidents involving dangerous goods seriously and will be following up with the shipper of the container to see what went wrong.

Emergency services had set up an evacuation zone of 800 metres as the chemical is a respiratory irritant. There have been no injuries reported.

Follow the live blog of CBC reporters, city and emergency services tweeting from the fire.