Commerce Minister Jurin Laksanawisit plans to call a meeting on Monday to assess the impact of the drought caused by the El Niño weather phenomenon, along with measures to address the impact.
Wattanasak Sur-iam, director-general of the Internal Trade Department, said the Commerce Ministry is monitoring the price of goods, especially agricultural products, as it is concerned about the impact of the drought situation.
"The price of bagged rice remains normal, despite recent news about a rise in rice prices following India's ban on exporting non-basmati white rice and the drought reducing production," he said.
The average price of a 5-kilogramme bag of Thai hom mali rice is 210 baht, while 100% white rice is 117 baht per kg, said Mr Wattanasak.
Several shopping centres are offering promotional discounts, such as a bag of hom mali rice for 165 baht in some provinces.
He said overall domestic rice prices are rising, though the department believes it will not significantly affect the price of bagged rice.
Domestic prices of hom mali paddy are currently quoted at 15,000 baht per tonne, up from 14,499 baht at the same period last year, while the price of white rice paddy is 11,150 baht per tonne, up from 9,217 baht last year.
In a related development, Chookiat Ophaswongse, honorary president of the Thai Rice Exporters Association, said shipments are stagnant because of the continuous surge of global rice prices and uncertainty caused by India's ban on exporting non-basmati white rice.
Mr Chookiat said India's move led to higher domestic rice prices.
For instance, the price of 5% white rice increased from 17,000 baht per tonne last week to 19,500 baht, while the price of white rice paddy has risen from 11,000 baht a tonne last week to 12,500-13,000 baht.
The free-on-board export price of 5% white rice is now US$600 per tonne, the same price as Vietnamese rice.
The price of 5% white rice is expected to surpass 20,000 baht per tonne this week, and there is a possibility of further price increases in the next 1-2 months, he said.
According to Mr Chookiat, rice mills that previously committed to delivering rice to exporters before India announced its export ban said they were unable to fulfil their delivery obligations because of the increase in prices.
On the other hand, rice importers hurriedly dispatched ships to receive the rice, fearing that prices might continue to increase.
"Rice exporters now face difficulties in procuring rice for delivery, and some of them have requested delays in shipment because of the challenging market conditions," he said.
"Exporters are finding it hard to buy rice in the market as there is speculation that prices will continue to rise."
However, the situation may improve once there is clarity on India's policy regarding the opening of export channels, said Mr Chookiat.
There is speculation if a country requests to buy rice for humanitarian reasons or food security, India may consider selling to them, he said.
For instance, Mr Chookiat said the Philippines requested a purchase of 1 million tonnes of rice from India, but it remains to be seen whether India will actually sell this quantity and at what price.