This phrase is a play on words from the children's song "Row, Row, Row Your Boat". The original lyrics include the line "Though the colonel is in a pompadour style", which doesn't fit well with the rhythm or meaning of the song. Someone noticed that if you replace "colonel" with "eels", it creates a nonsensical but amusing sentence: "My hovercraft is full of eels". It's often used humorously to suggest something unusual or unexpected.