Instrument produced by graduates thus performing (7)
I believe the answer is:
bassoon
'instrument' is the definition.
(bassoon is a kind of instrument)
'by graduates thus performing' is the wordplay.
'by' is a charade indicator (letters next to each other).
'graduates' becomes 'bas' (I've seen this in other clues).
'thus' becomes 'so' (synonyms).
'performing' becomes 'on' (I've seen this in other clues).
'bas'+'so' is 'basso'.
'basso'+'on'='BASSOON'
'produced' is the link.
(Other definitions for bassoon that I've seen before include "No, a boss would be a musical instrument" , "Double-reed instrument" , "Instrument - no ASBOs (anag)" , "So-so ban over the instrument" , "Low wind instrument" .)