Hat seen in canal (6)
I believe the answer is:
panama
I believe this is a double definition.
'hat' is the first definition.
(I know that Panama is a type of hat)
'canal' is the second definition.
'seen in' acts as a link.
(Other definitions for panama that I've seen before include "Land - hat - cigar" , "city" , "Wide-brimmed hat" , "Hat woven from jipijapa leaves" , "isthmus" .)