Cereal grass found in Arbroath (3)
I believe the answer is:
oat
'cereal grass' is the definition.
(oat is a kind of cereal grass)
'in arbroath' is the wordplay.
'in' says the answer is hidden in the clue.
'OAT' is hidden in the letters of 'arbroath'.
'found' is the link.
(Other definitions for oat that I've seen before include "Food grain" , "Basis of porridge" , "Cereal grass" , "Cereal (singular)" , "Cereal plant" .)