I think this used about 50 yards of yarn. I used size 6 straight needles. (Ideally you'll also have some DPNs of the same size to make the end easier.) Here's general instructions for making this sort of pouch.
1. Cast on an even number of stitches. (I used 30.) The cast on row should be a little less than twice as wide as you want the bag to be.
2. (s1, p1) to end, ending with a purl stitch.
Repeat row 2 until the pouch is to the desired length, or until you want to start decreasing. (Decreasing is optional; I did it here because I screwed up casting on and the pouch had a wider body than I wanted.)
If you want to decrease, follow these instructions:
3. s1, P1, and pass the slipped stitch over the purled stitch. (s1,P1) to end, ending with a purl stitch.
4. s1, P1, and pass the slipped stitch over the purled stitch. (s1,P1) to 2 stitches from end (ending with a slip stitch). P2tog.
5. (s1, P1) to 2 stitches from end (ending with a slip stitch). P2tog.
This reduces four stitches over three rows. Repeat rows 3-5 until you're down to the desired width. Then switch back to row 2 and continue until you've added about an inch to the pouch. (This gives you something to wrap the cord around.)
Until now you've been working both sides of the bag on a single needle. Now it will be necessary to separate the two sides onto different needles. To do this, take two DPNs, slip the first into the first (slip) stitch and hold it to the back of the work, then slip the second into the second (purl) stitch and hold it to the front of the work, and repeat until all the stitches have been transferred to the two needles. You should now be able to draw the two needles apart and look inside the bag.
Cast off stitches very loosely until there are three left, then work as an icord until you've got a long enough cord to wrap around the neck of the pouch and tie off. (I used a ten inch cord, which seems to be about right for my pouch.) Cut yarn, put through remaining stitches, and pull tight. Turn the bag inside out. You're done! (You can work in the ends if you want, but I don't think it's really necessary.)