The government plans to sell all 11.4 million tonnes of rice in government stockpiles within two months for 100 billion baht, the country's rice management board, starting next week.
The plan announced Monday is unprecedented in Thai export history - selling off more rice in two months than the country usually sells in a year. Average rice sales over the past couple of decades have been about 10 million tonnes.
Currently the world's second-biggest rice exporter after India, the government has been reducing stocks left over from the Yingluck-era rice-purchase scheme.
The military regime has successfully auctioned off 5.05 million tonnes of rice worth $1.53 billion through several tenders since May, 2014.
The sale of warehouse rice highlighted another problem on Monday - the drought.
There is not enough water in the Chao Phraya River basin to feed rice farms in the early rainy season next month, according to the Department of Royal Irrigation (RID). And there isn't even any guarantee that the rainy season will actually begin next month.
Suthep Noipairoj, the RID director-general, appealed to farmers to delay planting because of the scarcity of water.
He said water is running low in the four main dams in the Chao Phraya basin.
Farmers should begin planting when the rainy season is in full swing, expected in July, he said. “The Meteorological Department will make an announcement when it is time for rice planting,” he said.
Mr Suthep said he is certain there will be sufficient water reserves in the irrigation zone during the rainy season for the main rice crop. But the agency will need to assess whether the water collected will last for the second rice crop which follows the rainy season.
Full details on the drought problem for farmers here.
Traders were sceptical Monday about the government's ability to sell off remaining stocks in just two months.
Supachai Vorraapinyaporn, president of Tanasan Rice Group, the third largest rice exporter, said the government's target of offloading the rice within two months was not possible.
"This is a million percent impossible, considering that previous auctions were monthly, and only around 400,000 tonnes," said Mr Supachai.
"Perhaps they meant two years, not two months," he added.
The government had previously said it aimed to clear the stockpile by the end of 2017 - 20 months from now.
According to plans announced Monday, auctions will begin next week, with one million tonnes of rice for each lot.
"We aim to auction it all off within two months," said commerce ministry permanent secretary Chutima Bunyapraphasara, who is also secretary of the Rice Management Board. Ms Chutima said the remaining rice stocks were worth more than 100 billion baht.
Thailand has about 100,000 tonnes of what the commerce ministry has called "good grade" rice in state warehouses.
The remaining stocks include 7.5 million tonnes of "sub-standard" rice for human consumption, 1.5 million tonnes earmarked for industrial use, and 2.4 million tonnes of spoiled rice.
Chutima Bunyapraphasara, permanent secretary: Auctions will begin next month, and run weekly in May and June. (File photo)