However, the representatives later claimed the government negotiators had "wrongly announced" an agreement of 90 baht/kg for unsmoked rubber sheet.
The farmers' representatives had been pushing for 95 baht but the government stood firm at 90 baht.
The protesting farmers dispersed under the impression that the price had been agreed on by both sides, a farmers' representative claimed.
The decision was announced following a tense five-hour talk between the government panel headed by Finance Minister Kittiratt Na-Ranong and Deputy Prime Minister Pracha Promnok as well as 40 rubber farmers' representatives in Nakhon Si Thammarat.
The subsidy was to take effect within seven to 10 days.
Upon hearing the decision, protesting farmers at Ban Khuan Nong Hong in Nakhon Si Thammarat's Cha-uat district who had blockaded Highway 41 for 12 days decided to disperse, as did those blockading the Ban Nong Dee intersection in Na Bon district.
However, Amnuay Yutitham, a farmers' representative who took part in the negotiations, said he has rejected the 90-baht price and called for another mass rally.
He said rubber farmers in Nakhon Si Thammarat's Tha Sala district would gather on Sept 14 to press for a price of 100 baht a kilogramme.
"Because of the government's insincerity, we are going back to the original 100-baht demand," he said. In yesterday's talks, the group had agreed to cut the demand to 95 baht.
"We will discuss whether we will escalate the protest. If there are any further talks, they must have the prime minister at the negotiating table."
Mr Amnuay said the farmers in Cha-uat only ended the protest because they mistakenly thought the announced price was a result of an agreement reached by the negotiators.
He said some government figures called protest leaders at Ban Khuan Nong Hong and told them the farmers' representatives had agreed to the 90-baht price. They dispersed before learning this was not true, he said.
Pol Gen Pracha told a news conference that a price was reached in negotiations with the rubber farmer representatives. However, none of the farmer representatives attended the press conference.
Pol Gen Pracha welcomed the end of the protest at Ban Khuan Nong Hong.
Responding to Mr Amnuay's comments, the deputy prime minister said the majority of farmers were satisfied with the government's proposed subsidy of 90 baht/kg.
Kajbundit Rammak, a farmer representative from Songkhla, lashed out at the government team for announcing the price deal.
Mr Kajbundit said it was not true that the farmers were happy with 90 baht. He said the farmers would blockade the immigration office in Songkhla's Sadao district on Sept 14.
Friday's negotiations were the second attempt this week to resolve the rubber price stand-off. Talks in Bangkok on Wednesday failed to reach an agreement.
When the negotiations began, the farmers demanded the government stabilise the price of unsmoked rubber at 100 baht/kg by paying the farmers the difference between the market and the reference prices.
The farmers backed down to 95 baht as the talks proceeded, but the government would not budge from 90 baht.
Deputy secretary-general to the prime minister Thawat Boonfueng said the government was concerned that a price of 100 baht would benefit others more than the farmers.
Meanwhile, Prime Minister Yingluck Shinawatra said the rubber industry needed to be overhauled from top to bottom.
Speaking after a meeting with busziness leaders to discuss the rubber industry, she said an "integrated solution" was a must to tackle the problems besetting the industry.
She said zoning to ensure high productivity, good quality and cost cutting by rubber growers were necessary to solve the problem in the long run.
Ms Yingluck also said that if the cost of natural rubber could be reduced to be competitive with synthetic products, manufacturers were likely to choose the natural version.
She said the Finance Ministry had set aside a budget of 15 billion baht to support rubber processing and the government would increase the use of natural rubber in products such as medical rubber gloves, in the food sector and in the agricultural and automobile industries.
She said the government would also try to increase the use of natural rubber in state projects, such as road surfacing and other infrastructure-related construction.