That thing looks too small to be of use in the average brew. What kind of recipe is it? The bag looks very tightly woven as well. Not sure.
Compared to the bottle cap it's sitting next, I'd say it's slightly larger than a sandwich bag.
Prob something they used for pellet hops.
I know some brewers try to keep the hop gunk out of their fermenters. No real reason to in my opinion, but hey, people do what they do.
It looks pretty small for grain steeping - but that might be it too.