Watford's hopes of re-signing Nathaniel Chalobah are fading but the club does have alternative loan options in place if the Chelsea midfielder moves elsewhere, the Watford Observer understands.

Gianfranco Zola admitted yesterday (Thursday) that “not much” progress has been made in the Hornets’ attempts to bring back the England Under-21 international and efforts to agree a deal are proving “very difficult”.

The 18-year-old midfielder is thought to be keen on a return to Vicarage Road after becoming a key figure in Watford’s promotion push last season, scoring five goals in a total of 42 appearances.

However, we understand Chelsea are favouring a move to a club willing to pay most, if not all of his wages after he signed a new five-year deal at Stamford Bridge this summer, reported to be worth in the region of £30,000 to £35,000 a week.

With Nottingham Forest being strongly linked with the player, Watford may miss out on another loan target after Tottenham Hotspur’s Tom Carroll opted for a move to Queens Park Rangers.

Zola told the Watford Observer last week that “we are not a team that can offer the type of wages QPR are offering right now” and commenting on Chalobah, he added: “We can’t offer what other clubs can offer in terms of money but I think we can attract players. Nathaniel knows what we are and Chelsea know the type of work we do.

“We can still give Nathaniel something to help him develop. So I am relying on this and we’ll see what we can do.”

But asked if there had been any progress yesterday, the Hornets’ head coach responded: “Not much. Nathaniel is a player that has done very well for us. It is a possibility but it’s very difficult. We’re going to try our best but it is very difficult. We’ll see what happens.”

While the prospect of re-signing Chalobah looks unlikely, we understand the Hornets have other options they can pursue now the loan window has opened.

Zola hinted at this when asked if there was the prospect of other new arrivals.

“There might be a couple of opportunities but we want to see,” he said. “I think it is also down to how we produce the results right now.

“There are some positions, especially in midfield, where we could look for improvements but I don’t want to rush anything.

“If we see the opportunity to improve the squad we will do that but we are not in a position in which we have to do something because we are desperate.”

One deal Watford have completed this week is the signing of free agent Gary Woods, who has been training with the club since last month.

With three senior goalkeepers now on the books after the former Doncaster Rovers stopper committed himself to a one-year deal, this led to some speculation that Jonathan Bond may leave on loan to get a run of games under his belt.

But Zola said: “No, I will keep three and we will see if there are opportunities to maybe give Gary some games but we’ll see. But Bondy at the moment will stay with us.”

Commenting on the signing of the 22-year-old former Manchester United trainee who made 49 appearances for the League One champions last season, Zola said: “Gary has come here on trial and we like him as a professional and also as a goalkeeper. We played him in a friendly against Stevenage and he did very well so we believe he’s got everything we need and we can help him to progress.

“Obviously with the presence of two very good goalkeepers we have in Manuel (Alumina) and Bondy, I think we can help him to get better and I think it can be something good for both of us.”

Woods told the Hornets’ official website: “It’s good to get things done as it’s been a long summer. I felt this move was right for me and hopefully I can kick on. This is a good place to be. Everybody here is very down to earth, they all work hard and it seems a very good family-orientated club.

“I’ve played a lot of games at a young age but to work with the likes of Alec Chamberlain and Manuel Almunia, I think it’s a forward step to be able to get that experience from them. I think their help can take me onto the next level."