A handfull of cedar or juniper bark worked between your hands until it is nice and fuzzy works well around here.  
For starting birch bark, find a dead tree lying horizontally.  Hold your knife at a right angle to the surface and scrape up a pile of fine shavings.  Have a bunch of 1/2" wide strips ready.  
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 - Tom S. 
"Never trust and engineer who doesn't carry a pocketknife."