Davies, 21, has been on a dual-registration contract with the Knights this season and the club are now looking to make him part of their long term plans, as coach Chris Thorman starts his recruitment for 2013.
Thorman, who saw his side pick up their first victory, 26-22 over Swinton, at the weekend, has already started identifying targets for next season.
He said: “We had a positive meeting last week and the club have really signalled their intent for next season. We will start talking to players this week and we hope to have some positive news in the upcoming weeks.
“There are still a number of players in the current squad who we have not yet decided on and they have between now and the end of the season to impress.”
They could soon be joined by Davies, who has previously made seven Super League appearances for Castleford.