In failed negotiations in Bangkok last week, representatives of the farmers demanded that the government fix a price of 120 baht ($3.70) per kilogram (2.2 pounds) for rubber products, but the Agriculture Ministry made an offer of 80 baht ($2.50).
This week, the farmers lowered their demand to 101 baht ($3.14), but the government said price intervention was not the answer to the declining prices. The current price is 86.15 baht ($2.68).
"The government doesn't believe this measure would improve rubber prices because the price guarantee might lead to weaker market prices," Deputy Prime Minister Kittirat Na Ranong told reporters in Bangkok on Tuesday.
Thailand is the world's top producer and exporter of natural rubber, which is used in products from condoms to car tires.
Rubber prices in Thailand have steadily dropped since peaking in 2011 due to weaker demand in a sluggish global economy.
The government currently subsidizes rice growers by paying them above-market prices, a scheme that has accumulated losses of at least $4 billion since its inception two years ago and has resulted in Thailand losing its spot as the world's No. 1 rice exporter.