CAZE, which owns nine of Mexico's 60 sugar mills and employs some 37,000 workers, is under investigation for accepting federal subsidies to export about 114,000 metric tons of sugar, and then selling it on the local market, depressing local prices.

The sugar consortium was first publicly attacked weeks ago over allegedly sketchy exports in the 1996/97 harvest, when it received some 102.9 million pesos (about $11.1 million) in export subsidies.

Newspapers said the exports never reached supposed destination points.

"The CAZE sugar mills complied with the legal requirements to exercise its rights to said subsidies," the company said in a statement late Wednesday, claiming definitive exports for the period.

"CAZE presented to the then Trade Ministry and the National Sugar Fund (FINA), all of the documents that in its opinion accredited its right to request the subsidies," the company said. "The documents were validated by both institutions."

The statement Wednesday was sent by fax to Mexican media. Previous communication with the media was strictly on the basis of exclusive interviews with certain organizations.

The news release, handled by a local public relations firm, comes at a time of crisis for Mexican sugar producers. They have been protesting in front of government buildings since Monday to demand pay for the 2001/02 harvest, now drawing to an end.