State Trade Minister John Mickel said the NTA Group, owned by Nature Trust of Japan, recently completed construction of a factory at Childers and has Japanese and Australian patents pending for a machine to separate the bark and core of the kenaf plant.

In alliance with Isis Central Sugar Mill, NTA is already growing more than 150 hectares of kenaf at Childers.

"The factory, which will employ 10 people on a full-time basis, is expected to produce fibre and core from the kenaf when it reaches full production capacity," Mr Mickel said.

"Kenaf fibre can be used as an environmentally friendly bioplastic product, and, with high growth and CO2 absorption rates, its products complement the Queensland Government's policies supporting environmentally friendly and sustainable agriculture."

Kenaf is an 'off-season' crop to sugar cane and has the potential to help increase productivity for local farmers.

NTA has identified kenaf for use as garden mulch and has already started producing high water-holding capacity kenaf mulch at its factory.

It is expected that kenaf products from the Childers area will eventually be exported to Japan and Asia.

Launching the production initially with mulch, NTA plans to develop its products to make them suitable for construction materials, bioplastics input, paper pulp and other uses in the second phase.

Mr Mickel said the company is expecting to turn over around $15 million in Australia and Japan from the factory's output.