Diaz, 22, a right-handed-hitting shortstop from Villa Clara, defected from the Cuban National team last summer during a tournament in the Netherlands and has been training in Mexico City. The 6-foot-1, 185-pound Diaz and Alvarez, 24, have established residency in Mexico -- the first step to becoming a free agent -- and both have submitted their paperwork to the Commissioner's Office, the source said.
Diaz plans to train with the professional team in Mexicali, Mexico, and take part in a series of showcases that could start next week. Several teams have already expressed interest in the infielder, but will likely have to wait until early next year to sign him.
Cuban players that are at least 23 years old and have played at least three seasons in a Cuban professional league are not subject to the new international signing guidelines established by the Collective Bargaining Agreement. Diaz, who made his professional debut in 2007 for Villa Clara in Serie Nacional, the country's top league, will turn 23 on Jan. 8 and is not expected to sign before his birthday.
Known for his ability to hit for power and average, Diaz is considered an average runner with an above-average arm. He is closer to Major League-ready of the two prospects.
Alvarez, a right-handed hitter who played for Camaguey in Serie Nacional, defected from Cuba last summer and has been playing professionally in Vera Cruz, Mexico, since October. The 6-foot-2, 190 pound Alvarez can play all three outfield positions and has impressed Major League scouts with his above-average arm during league-play in Mexico.
It's already been a banner year for Cuban prospects. Last season's class was highlighted by outfielders Yasiel Puig, who signed a seven-year, $42 million deal with the Dodgers last summer, and Yoenis Cespedes, who signed a four-year, $36 million deal with the A's in February. Outfielder Jorge Soler also signed a nine-year, $30 million deal with the Cubs in June.
Other notable signings include left-handed pitcher Omar Luis Rodriguez, who signed a Minor League deal worth $4 million with the Yankees, and lefty Gerardo Concepcion, who signed a five-year, $6 million deal with the Cubs.
It's too early to tell if Diaz and Alvarez will command contracts similar to Cespedes, who was Major League ready when he signed, or Puig, who impressed scouts with his size and five-tool potential before signing with the Dodgers.