Thailand, the world's biggest rice exporter, planned to increase annual production by 15 percent to 35 million tonnes of paddy by 2015 to meet rising global demand, a senior Agriculture Ministry official said.

The country currently produces around 30 million tonnes of rice annually, equivalent to about 18 million tonnes of milled rice. Domestic consumption is around 8 million tonnes and the rest are for export.

"We succeeded in developing a new hybrid rice strain which produces higher yield and we planned to distribute it to farmers in the next crop year, production would rise significantly by 15 percent in 2015," Prasert Gosalvitra, director-general of Thailand's Rice Department told Reuters.     

The country needs to develop the new rice strain because it has limited land for rice farming, he said in an interview on the sidelines of Thailand Rice Convention 2011.

"It's because of urbanisation, industrialisation as well as crop switching that limited land for rice farming," he said, referring to the country's overall 9.1 million hectares of rice farmland.

The PT06001H new hybrid rice strain could produce higher yield of 900-1,200 kg per rai (0.16 hectares), compared to the current average of 468 kg per rai.

"And with this rising rice production, I can guarantee right now that we will have 8-10 million tonnes for exports every year from now on," Prasert said.

Thailand exported 8.7 million tonnes of the staple grain in 2010 and aimed to export 9.0-9.5 million tonnes this year, about a third of global rice trade.

He said that global rice demand was expected to remain strong in the coming years along with the rising world population, while supply in major rice producing countries was likely to be reduced by harsh weather conditions.

Global rice prices have lagged the rise in other food grains this year, though loading demand and concerns over possible aggressive intervention by the next Thai government drove up Thai rice prices in the past week. But prices are unlikely to hit records seen in 2008 in Asia, especially with countries such as Vietnam trying to grab market share.

The G20 group of large economies will monitor world supply of key grains to help prevent speculation from pushing up food prices, a draft statement of a ministerial meeting this week showed. Food prices have eased in recent weeks in Asia, after a series of state-initiated measures such as offloading state grain reserves into the market, curbs on speculators and policy tightening.     

Prasert said Thailand still needed to overcome difficulties facing rice production. "There are the problems of pests and climate change that we have to take into account," he said. "But, I don't think the two risks could disrupt the plan to increase production because we can manage them."     

The Agriculture Ministry has limited the spread of grasshoppers within 20,000 rai, down from 2 million rai in the past year, he added. - Reuters