The Thai Rice Exporters' Association will ask the new government to lower the price-intervention level for main-crop rice in the upcoming harvest.

"Unless it reviews the current high price level used by the previous Samak Sundaravej regime, Thai rice exporters will have to go on a long holiday next year as they will not be able to compete with other rice-exporting countries," association president Chookiat Ophaswongse said.

The government currently buys white paddy rice from farmers at Bt14,000 per tonne as part of the market intervention programme, compared with the prevailing market price of around Bt12,000.

Chookiat said the country's rice trading system will be seriously damaged by such a price distortion.

The previous Samak Cabinet aimed to buy a total of 8 million tonnes of paddy rice from October 16 till February next year.

"If the government in- sisted on intervening at Bt14,000 per tonne, then it could face a potentially huge burden of having to set aside a state budget of up to Bt120 billion for this scheme [which would incur big losses based on the current market price].

"Farmers will go on the streets rather than sell their paddies to anyone below that price," said Chookiat, adding the country's rice export volume would also fall next year due to increased output from many rice-exporting countries.

Worldwide, the combined rice supply is expected to increase by 10 million tonnes next year from this year's 428.02 million tonnes.

At present, white rice accounts for more than 40 per cent of Thailand's total export volume, so the new government must ensure that its market intervention programme, covering white rice, does not hurt export trade.

Chookiat said the market price of Bt12,000 a tonne for white rice is still appropriate for farmers, given that production cost is now about Bt7,000 a tonne.

Unlike jasmine rice, a lower price guarantee would not affect white-rice farmers, because they can plant three crops a year, Chookiat said.

The export price of Thai regular white rice is now US$770 (Bt26,500) per tonne, down from US$776 the previous week, while Vietnamese white rice is priced at only $570.

As for Thai jasmine rice, the price has dropped from $913 a tonne to $890. Chookiat said the new government should also assign the Commerce Minis-try to implement its rice policy so that government stockpiles could be managed properly.