Fibre claimed by cereals is a laugh! (5)
I believe the answer is:
sisal
'fibre' is the definition.
(sisal is a kind of fibre)
'claimed by cereals is a laugh' is the wordplay.
'claimed by' says the answer is hidden in the clue.
'SISAL' is hidden within 'cereals is a laugh'.
(Other definitions for sisal that I've seen before include "material for painter, say?" , "Agave cultivated for its fibre" , "Fibre from agave plant" , "Fibre-yielding agave" , "Strong rope fibre" .)