Previously expected to sign for the Brazilian club, the 20-year-old defender has seen the deal between the two sides reach an impasse. Nacional director Alex Saul admitted to Radio 1010 that the situation is "very difficult", and that his club will "unfortunately have to look at other offers".
Ovacion subsequently reports that Porto have now moved to the front of the queue to sign the youngster, who was a defensive rock during their 2010-11 Uruguayan Championship victory which was sealed last week. He is currently away with Uruguay hoping to secure a surprise place in the nation's squad for the Copa America.
The Portuguese side are set to offer around €3.5 million for Coates, who at 6'6" tall is almost unbeatable in the air and widely recognised as the most promising centre-back in Uruguay.
The player's agent, Matias Pittini, confirmed that there is interest from across the Atlantic Ocean, but also pointed out that neither he nor Nacional have received a formal offer for the youngster.