* Thailand expected to ship 7.5 million tonnes in 2014 -exporters association
* India ranks world’s biggest exporter, Thailand third : USDA
* Prices expected to drop on rising supply
* Thai political chaos to put more pressure on rice prices (Adds comments on price pressures, data on global production)
By Apornrath Phoonphongphiphat
BANGKOK, Feb 5 (Reuters) - The Thai Rice Exporters Association expects the country to export 7.5 million tonnes of rice in 2014, up about 14 percent from the 6.6 million tonnes shipped in 2013, as the government struggles to fund a controversial rice intervention scheme.
Thailand’s embattled government desperately needs money to pay farmers for rice it guaranteed to buy at above market rates. But with parliament dissolved and the government in a caretaker role, uncertainty has grown over the future of the scheme.
The controversial policy has underpinned crucial rural support for the government of Prime Minister Yingluck Shinawatra, which is now in limbo after holding an election boycotted by the opposition and disrupted at the ballot box.
“We expect the government to release a substantial amount of rice from state warehouses so we would have more supply for exports this year. But prices are likely to fall,” rice export association president Chareon Laothammatas told reporters.
The government said it would open a tender to sell 400,000 tonnes of rice from state stocks next week.
Rising rice supplies and uncertainty over the future of the intervention scheme, which expires on Feb. 28, would put pressure on prices, said the association.
“That means prices will definitely be on a downward trend as everybody knows that supply is rising everywhere,” Chareon said.
The U.S. Department of Agriculture (USDA) has predicted a bumper crop in India of around 103 million tonnes in 2013/14.
Thailand is expected to produce 20 million tonnes and Vietnam was likely to have 27 million tonnes, according to the USDA data.
Thailand’s protracted political crisis was also expected to add pressure to prices, exporters said.
“Prices are likely to fall as there is no certainty over whether the current caretaker government can renew the scheme when it expires, while farmers are due to harvest a second crop,” said Vichai Sriprasert, a honorary president of the association.
The price of common grade Thei 5 percent broken white rice was offered at $445 per tonne on Wednesday, slightly higher than the same Vietnamese grade at $390-$400 per tonne, exporters said.
The USDA has forecast Thailand will export 8.5 million tonnes in 2014 as global demand rises, especially in China and Africa.
According to the USDA, India remained the world’s biggest exporter, shipping 10.5 million tonnes in 2013.
Vietnam ranked number-two, exporting 7.2 million tonnes, while Thailand was third with 6.6 million tonnes of exports. (Editing by Michael Perry)