Cryptic crossword clue
Muppet cut wood 3

The most common and most likely answer to this crossword clue is the 3 letter word ELM

I've seen this crossword clue in Independent
E
L
M

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The cryptic/wordplay part
In cryptic crossword there's often an wordplay/cryptic part as well.
This part involves a more complex hint, such as an anagram, homophone, hidden word, etc.
Sadly, We don't have an explanation for this specific crossword clue yet.

What does ELM mean?

ELM noun
  1. A tree of the genus Ulmus of the family Ulmaceae, large deciduous trees with alternate stipulate leaves and small apetalous flowers.
  2. (usually attributive) Wood from an elm tree.

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