
Thirachai, a former chairman of the Medicine and Public Health Board, is a business partner of Thaksin's.
Chaiya's decision to appoint a new board chairman comes in his first month as commerce minister. The board has not been newly set up since ending its term during the Surayud Chulanont administration.
The appointment will be made after expected Cabinet approval next Tuesday.
Thirachai was recently dismissed from the Medicine and Public Health Board after being appointed its chairman in May, also by Chaiya, who was public health minister at the time.
Thirachai is also a former deputy Bangkok governor and former board member of Thai Airways International.
Thirachai has a close relationship with Thaksin, whom he helped buy Manchester City football club, and is on the board of Traffic Corner Holdings, which is owned by Shinawatra family members.
However, Chaiya denies knowing Thirachai personally.
A state-owned enterprise, the PWO is the marketing arm of the Commerce Ministry. Despite normally facing losses from its operations, the organisation enjoys sustainable revenue from rice-stock management of Bt45 per tonne per day.
The government has 3.4 million tonnes of rice stockpiled.
The agency is also responsible for other agricultural products, including shrimp, cassava and corn.
The organisation has three main responsibilities: providing services to fully equipped warehouse cold-storage and wharf facilities, carrying out government policy for agriculture and other consumer products, and importing and exporting goods.
The PWO has been involved in several corruption cases. One resulted in the dismissal of the organisation's president in 2005. He stood accused of helping four rice surveyors win the bidding for the right to check all government rice stockpiles.