The strong baht is expected to whittle down the revenue of Thai rice exports in baht terms by 30-40 billion baht, lowering shipments to 8-8.1 million tonnes this year.
Chookiat Ophaswongse, honorary president of the Thai Rice Exporters Association, said rice export prospects remain dim, with the baht making local grains more expensive than those from Vietnam, China and India.
Prices of Thai white rice are around US$50 per tonne higher than those of Vietnam, while China, which holds hefty rice stocks, has beefed up shipments of its cheaper rice to Africa.
"Thai rice shipments may slip as low as 8 million tonnes this year from 11.2 million tonnes last year, led by a sharp drop in white rice exports," said Mr Chookiat.
The strong baht is expected to lower white rice shipments by up to 35% from 5.49 million tonnes last year.
Normally Thailand's rice exports average 10 million tonnes a year, with white rice making up half the amount.
He said white rice shipments may only total 3 million tonnes this year.
In July, the association cut its target for annual rice exports from 9.5 million tonnes to 9 million.
Of the total, white rice will account for 3.9 million tonnes, followed by parboiled rice at 2.8 million tonnes, hom mali rice at 1.3 million tonnes, aromatic rice at 600,000 tonnes and glutinous rice 400,000 tonnes.
Major rice-importing countries have also changed their rice-buying policies. The Philippines allows its private sector to play a greater role in imports, stiffening competition in the domestic market.
The drought in Thailand will also cut rice output and may result in higher prices, said the group.
The Commerce Ministry's latest report put rice exports in the first nine months this year down by 28.1% year-on-year to 5.9 million tonnes.