There is one other phrase in the chorus which indicates that the song is associated with, and displays some detailed knowledge of, forgework.
That is the description "bright hammer".
Bright is the term used in metal work for steel which is polished and shiny. The face of a hammer, in frequent contact with the oxide scale on the hot workpiece becomes highly polished.
Green, unseasoned willow would be a cheap and easily replaceable material for the blowpipe of a bellows, and with its high moisture conten, would last better than most timbers.
The sharp double sighting tap on the anvil, followed by the heavier and duller sound of the strike on the soft, red-hot metal could well be represented by "twanky dill" with a the traditional added"o" to make it more folkie- (like welcoming in the Mayo!)
It just all works out as a song from the smithy to me.
Now I wonder if blacksmiths and farriers ever drank beer....
Cheers
Dave