Sauce: favourite covering small duck (5)
I believe the answer is:
pesto
'sauce' is the definition.
(I've seen this before)
'favourite covering small duck' is the wordplay.
'favourite' becomes 'pet' ('pet' can be a synonym of 'favourite').
'covering' is an insertion indicator.
'small' becomes 's' (abbreviation - e.g. clothes size).
'duck' becomes 'o'.
'pet' placed around 's' is 'pest'.
'pest'+'o'='PESTO'
(Other definitions for pesto that I've seen before include "Basil and pine nut sauce" , "Italian sauce containing basil" , "A sauce served with pasta" , "Basil-based sauce" , "Sauce made of basil and cheese" .)