Capital adversary invested in cereal (8)
I believe the answer is:
santiago
'capital' is the definition.
(capital of Chile)
'adversary invested in cereal' is the wordplay.
'adversary' becomes 'anti' (I've seen this before).
'invested in' indicates putting letters inside.
'cereal' becomes 'sago' (edible starch).
'anti' placed inside 'sago' is 'SANTIAGO'.
(Other definitions for santiago that I've seen before include "Chile's capital" , "Chilean capital" , "Capital of Chile" , "City" , "South American capital" .)