Not trad, and only one verse refers to knitting, but there's a wonderful silly song by Jan Harmon "Deepest Africa" which Hot Soup recorded on what I BELIEVE is their first album: Soup Happens. That's not the only gem - the whole album is a treat, but Deepest Africa lists a number of critters the singer has taught to do various things (sing, dance, knit, fly)
The verse in question:

I was in deepest Africa, yes I was, yes I was
I was in Deepest Africa teaching gnus to gnit.
Now each stitch that gnu gnit
He would throw a fit like a big gnit-wit
I was in deepest Africa teaching a gnu to gnit.
(Spoken: Gnit one, pearl two, Gnit one, pearl two)

Joanne in Cleveland