This item is often bought from apprentice wizards with an adventurer’s first reward from questing. It is a yellow bag with the word “cheese” embroidered on it (in Common). Any food you put in this bag becomes cheese, but retains its original taste and condition—a moldy and dirty loaf of bread becomes a moldy and dirty piece of cheese. Any non-food items develop a distinctly cheesy aroma.
Alternatively, you can turn the bag inside out, transforming it into 1 Supply worth of any type of mundane cheese.