A model displays Hawick Cashmere

The firm has entered into consultation over proposals to close its Eyemouth plant and reduce staffing levels at its main Hawick centre.

The company has blamed the move on improved knitting machinery and low cost competition from overseas.

It is the latest in a string of cutbacks announced by knitwear firms across the Borders.

Hawick Cashmere deputy chairman Jim Thomson told BBC Scotland news website the company had entered 30-day consultation over the plans.

"Potentially there will be 21 people in Eyemouth and 25 people in Hawick," he said.

"The reasons are because of new advances in knitting technology and seamless knitting mean you need fewer people to make the product."

It is extremely hard for the people affected and we need to make this transitional phase as painless and as sympathetic as possible Jim Thomson Deputy chairman Hawick Cashmere

Mr Thomson added that although the company made luxury knitwear it also made less expensive products during quieter periods.

It is these garments which have come under pressure from cheaper overseas competition.

The company intends to close its Eyemouth plant completely and reduce staff levels in Hawick from 137 to 112 by the middle of August.

"It is extremely hard for the people affected and we need to make this transitional phase as painless and as sympathetic as possible," said Mr Thomson.

'Technological change'

Liberal Democrat MSP for Roxburgh and Berwickshire, Euan Robson, expressed concern at the impact on Eyemouth.

"This news is very disappointing and my immediate thoughts are of course with those who will be affected," he said.

"Technological change in the industry leading to whole garment knitting machines and the relentless competition from low cost, low wage overseas producers seem to have led to this very unfortunate development."

Earlier this year Borders College cancelled plans to house a knitwear and design technical centre in Hawick.