Experts suggest farmers produce rice seeds rather than grains to ease the impact of falling prices because of the surplus created by the government's rice-pledging scheme.
The government may take a long time to unload such a large amount of rice, estimated by traders at 17-18 million tonnes of mostly white rice.
Some scientists have also encouraged growers to switch to higher-value rice varieties such as Khao Leum Pua black glutinous rice and Rice Berry, two highly nutritious grains with strong demand.
"Several seed firms have already teamed up with farm agencies to promote rice seed production to help farmers earn more," said Vanida Angsuphand, president of the Thai Seed Trade Association (Thasta).
The value of rice seed is much higher, about 23,000 baht a tonne as quoted by the Rice Department, compared to an average of 8,200 to 8,300 baht for paddy rice sold this week.
Despite the high price offered by the government's rice-pledging scheme, farmers often receive less than 15,000 baht a tonne due to high moisture. Many also prefer to sell quickly to receive their money quickly.
"The supply of rice seed remains lower than demand as the Rice Department is still unable to supply sufficient volume," said Ms Vanida.
The department plans to produce 85,000 tonnes of rice seed for the 2013-14 crop, less than 10% of demand which is estimated at 1.04 million tonnes.
"More use of quality seeds also improves productivity," she said.
Many farmers cannot afford to pay for seed, so they use grain for replanting, resulting in low output.
The Agriculture Ministry said average rice production in Thailand is 454 kilogramme per rai, below other countries in the region such as Vietnam (803kg), Malaysia (588kg), Laos (579kg) and the Philippines (576kg).
Switching to making seed requires investment in facilities _ a dryer, grain-sorting machine, and temperature controlled storage room are needed. Verification from the Rice Department is also needed before seed can be sold.
Making 20 tonnes of seed a month requires an investment of 20 million baht.
The Rice Department supports the move as it would help farmers who produce more than 350,000 baht worth of paddy, the ceiling set for the scheme this year. About 7,000 growers would have production exceeding the ceiling.
The department plans to select farmers to join a training programme to make seed to ensure they strictly follow the procedure to meet purity standards.
Olarn Chaiprawat, an adviser to the prime minister, said the country's rice farmers should turn to making more value-driven products for niche markets rather than growing rice for the masses.
Premium rice made by many communities has proved popular, including organic fragrant Hom Mali from Phayao and Chiang Rai, and glutinous Khao Leum Pua from Phetchabun and Tak provinces.