Flax plant
The flax plant has 3 stages. The first one is shown here on the right. Even though on the picture it grows on farmland you can now grow it on normal grass. It will also generate in the world on grass.

When you harvest this in any of the stages it could drop flax seeds, but when you harvest it in it's last stage when it gets blue flowers it will also drop flax fibre.

With the flax fibre you can craft string.

Flax to string

With the string there is also a new recipe to create cloth.

String to cloth

Wool can also be crafted into cloth like this.

Wool to cloth

There are 2 things you can do with cloth.

The first is to create wool out of it.

Cloth to wool

But the most usefull part of this item is to create leather armor.

Leather helm

Leather body

Leather pantws

Leather boots