Colback moved to Championship club Forest on a season-long loan deal from Premier League side Newcastle United last week.
The report has also claimed that Rotherham United, who will play in the Championship next season after getting promoted from League One, are favourites to sign the the youngster.
Forest are aiming to win promotion from the Championship next season, and competition for places in the first team will be fierce.
Yates is only 20 years of age, and it is going to be tough for the midfielder to get much playing time at the City Ground.
It would make sense for the Englishman to join Rotherham on loan and get some good playing time in the Championship.