"Crushing has started, since Nov. 15, and we expect to have 99 million tonnes of cane or roughly 9.9 million tonnes of sugar this year as the floods caused minimal damage to the crop," Prasert Tapaneeyangkul, secretary-general of the Office of Cane and Sugar Board (OCSB), told Reuters.
That was broadly in line with traders' and millers' estimates of around 9.5-10.0 million tonnes of sugar and compares with a 2010/11 crop that produced 9.6 million tonnes of sugar.
Thailand has been hit since late July by its worst floods in at least 50 years. Industry has suffered badly and the rice crop has been hit but sugar areas were not badly affected.
The OCSB, which oversees the country's sugar industry, said it had set aside 2.4 million tonnes of sugar for domestic consumption in 2012, known as Quota A.
"Let's say we should have around 7.5 million tonnes left for export in 2012," Prasert said.
In recent years, Thailand has tended to allocate around 2.0-2.2 million tonnes for domestic consumption.
In 2010, when it needed to buy back 100,000 tonnes of sugar from trading houses because of domestic supply problems caused by high international prices, it set aside a higher volume of up to 2.5 million tonnes for the home market in 2011.
Prasert said the rise in Thai sugar production was not big enough to cause any slump in global sugar prices, adding that overall demand was strong.
"The global economy may not look very good but that doesn't mean people will stop consuming a basic foodstuff such as sugar. They could stop buying cars or whatever if the economy turns bad, but not food like sugar," Prasert said.
"Prices should adjust themselves, with a balance in demand and supply," he said.
New York ICE raw sugar futures for March delivery rose 0.22 cent to settle at 23.12 cents a lb on Monday.
Prasert said that although supply was rising in major producers in Asia and exports of 1 million tonnes were expected from India, he did not expect a sharp fall in global prices.
Last week India approved 1 million tonnes of white sugar exports, double the amount expected from the world's second-biggest producer, which sent global prices lower.
"I expect the 1 million tonnes of Indian sugar could offset falls in Brazilian production so there shouldn't be any oversupply to cause any big drop in world sugar prices," he added.
Sugar output in Brazil's center-south in the first half of November fell 13.8 percent from a year before, according to the country's industry association, Unica.