Torres, who is currently at Atletico Madrid, is said to want a move back to the Premier League and Newcastle are keen to offer him a home.
The Magpies are looking for a new striker, and feel that Torres could be the answer to their goalscoring problems.
Although the 33-year-old has not scored prolifically for Atleti, he would be a high profile capture and Benitez knows him well.
Benitez worked with Torres at Liverpool, earlier in their respective careers, and he helped turn the striker into a genuine superstar.
He said: "He [Torres] was a big price but we knew we were signing a young player who could improve. His value is higher now. He was a good signing in every sense.
"I would not want to swap Fernando for anyone else in the world because he is my player and I'm very pleased with him.
"There are good players in Europe and all the way around the world, but better than Torres - no.”
Torres may have lost the electric pace which once made him one of the most fearsome strikers in world football, but he still remains an exciting potential buy for Newcastle.
Newcastle should have more money to spend in January, following the expected takeover from Amanda Staveley, and that could enable the transfer to take place.
If Torres does move to St. James’ Park, he will be in competition with Dwight Gayle, Aleksandar Mitrovic and Joselu for a first-team place.