American sweet almost made a hole round fabric (7)

I believe the answer is:

taffeta

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'fabric' is the definition.
(taffeta is a kind of fabric)

I can't explain the rest of the clue.

(Other definitions for taffeta that I've seen before include "Thin crisp lustrous silk" , "fine stuff indeed!" , "Fine crisp lustrous fabric" , "Shiny fabric for fat fate" , "Smooth, stiff fabric" .)

I've seen this clue in The Telegraph.

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