Came across the twin of that one in our vegie garden up here in FNQ just a few days ago. Had never seen anything like it. It is the 'Saunders Case Moth' aka 'Large Bagworm' Initially the caterpillar weaves a bag of silk around it & then adds whatever is around to form a protective case. They retreat into the case to protect themselves & can close the opening at will. It was obvious that they have really good eyesight.
https://en.wikipedia.org/wiki/Metura_elongatus