People knotting lace and shreds (7)

I believe the answer is:

tatters

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'shreds' is the definition.
('tatter' can be a synonym of 'shred')

I can't explain the remainder of the clue.

(Other definitions for tatters that I've seen before include "Rags, shreds" , "Rags and torn pieces" , "Torn pieces of cloth" .)

I've seen this clue in The Mirror.

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