When the clouds are on the hills, They'll come down by the mills.

The rhyme starts with clouds on the hills and describes them moving down toward the mills. Its two locations make the expected movement the point of the saying.

Seeing clouds on the hills is presented as a reason to expect them by the mills as well. The words do not say how long that would take or whether rain would follow.

If clouds are visible on the hills, someone could use the rhyme to suggest that they may reach the area by the mills. Treat it as an expression of that expectation, not a dependable forecast.