Thailand could become the second-largest sugar exporter, up from No.3, were it not for most countries' attempts to protect their domestic industry via tariffs and non-tariff barriers, says the Thai Sugar Millers Association.
The world's largest sugar exporters are Brazil, Australia and Thailand.
"Under the 1992 Asean Free Trade Area (Afta), Brunei, Malaysia, the Philippines, Singapore and Thailand agreed to cut tariffs on sugar to between zero and 5% by 2010. Laos, Cambodia and Vietnam still have until 2017," said Cherdpong Siriwit, chairman of the association.
"In reality Afta failed to achieve its goal because some Asean members, although the region is a net importer of sugar, instead use non-tariff barriers to protect their domestic industry."
Some 45% of Thai sugar is shipped to Asean members, with Indonesia the largest export market in the region with 1.8 million tonnes in 2013.
Thailand's sugar exports reached 5.3 billion baht last year.
Rangsit Hiangrat, director-general of the Thai Sugar Millers Corporation, which assists with research services to the association, said Asean Economic Community slated for late 2015 should benefit the Thai sugar industry greatly if the problem of non-tariff barriers is addressed.
Thailand should negotiate with other Asean members to have more open markets, said Mr Rangsit, as Thailand has an edge over other exporters due to its close proximity to major markets and cheaper freight costs.
"Countries like Indonesia can delay their tariff reductions by placing sugar on the 'highly sensitive list', while the Philippines placed sugar on its 'sensitive product list' so it could avoid tariff changes until 2015," said Mr Rangsit.
He said Indonesia used several procedures to slow down sugar imports including a 20% tariff, while Malaysia allows raw sugar but restricts white sugar imports through tariffs.
"Indonesia imports more than 2 million tonnes yearly because its output falls short of domestic demand," said Mr Rangsit.
"The Indonesian government imposes a rule to force consumer product producers to use only locally made sugar, while industries can use imported sugar only if they receive government permission, of which there is no guarantee."
Thailand is a net exporter of sugar, with 10 million tonnes of output annually. Only specialised sugar is imported for use in pharmaceuticals or for expat consumers.