Suicide bombings and the threat of civil war are scaring most companies away from Iraq, but not tiny Durra Building Systems.

From its base in this small farming community northeast of Dallas, Durra, along with its sister company in Australia, is planning to ship an affordable housing kit to Baghdad within a month.

It hopes to capitalize on a housing shortage in Iraq estimated at 1.4 million units.

For the maker of alternative building materials, gaining a toehold in Iraq has turned into an exercise fraught with delays. But Durra is one of the few U.S. companies eager to do business there without the benefit of lucrative government contracts.

"Whether we will be successful we don't know," said Jack Norman, president and managing partner of the 11-employee firm.

For small firms, entering the Iraq market can almost seem like an assignment straight out of "Mission: Impossible."

"There is no step-by-step system like we have here to do business," said Bert Sanchez, a representative of the Iraqi American Chamber of Commerce and the director of the International Business Center at Pierce College in Woodland Hills, Calif.

Even though Iraq holds the world's third-largest oil reserves, decades of dictatorship under Saddam Hussein have left the country's private sector with little knowledge of how a market economy operates, he said.

"The good news is they need everything in Iraq," said Sanchez, who advises U.S. companies to get involved now before competition heats up.

"The bad news is they need everything in Iraq, including more modern business practices."

So far, only a handful of U.S. firms -- other than military contractors and other government suppliers -- are venturing into Iraq.

Coca-Cola Co. recently announced plans to set up a joint-venture bottling company, and Burger King Corp. operates out of a trailer at Baghdad's airport. But the violence and political instability are keeping most companies away.

Yet firms such as Durra have plenty of reasons to look to Iraq for the long term.

Analysts at Global Insight, an economic analysis, forecasting and consulting firm, predict that the Iraqi economy will enjoy strong growth in the next five years, even if the insurgency continues at its current intensity.

Driving the increase: rising oil production and revenue, foreign aid and spending by the coalition members. Already, real estate prices have skyrocketed more than 500 percent since Saddam's overthrow in March 2003. And with incomes and wages soaring close to 100 percent, spending by consumers is booming, Global Insight said.

The country has eliminated most import duties, lowered its income tax rate and permitted foreign ownership of some Iraqi companies. And in July, U.S. and Iraqi officials signed a trade agreement to foster closer economic ties.

"Iraq's booming economy and large oil revenues have created many profitable investment and trade opportunities for those who are willing to accept the risk," said Nader Habibi, managing director of Global Insight's Middle East and North Africa Department.

Durra is willing to gamble.

The company, which was launched in 2000, licenses its technology from Ortech Industries in Australia. Durra is majority owned by John P. Burg, a former Texas Instruments senior research geophysicist. Other investors include Norman, who is also a farmer, and Ortech.

Though Durra is trying to sell its housing kits in Iraq, its main business is manufacturing movie-theater walls made out of panels of wheat straw, which have been proved to block all kinds of sounds. Its walls can be found at theaters around the country.

But the wheat-straw panels can also be used to build houses, schools, emergency shelters and other facilities.

To get into the Iraq market, Durra and Ortech plan to ship a kit for a 600-square-foot house to architect Sam Kubba in Baghdad. Kubba, an Iraqi who lived in the United States for many years, plans to set up the house in Baghdad and show it to government ministers and contractors.

If there's enough interest, Durra and Ortech hope to license their technology to a company in Iraq, where wheat is one of the most important crops.

Durra's housing kits consist of metal frames and the panels made of wheat straw, the stalks of wheat left over after farmers extract the kernels. Durra buys wheat straw from farmers within a 50-mile radius of its plant, a yellow metal building surrounded by wheat fields. Farmers used to burn the straw, but now most plow it back into the soil because of environmental regulations.

Inside Durra's plant, towering bales of wheat straw are stacked in one corner. A machine running the length of the building compresses the straw into panels using extreme pressure and temperatures of up to 425 degrees. The process activates the straw's resins, its natural sugars, which bond the fibers together.

Then Durra's machines apply a moisture-resistant liner paper over and around the panels using a water-based glue.

The panels meet fire safety and mold standards, can withstand insects and offer significant environmental benefits.

Durra estimates that constructing a 2,000-square-foot building requires either 18 acres of wheat straw or an acre of clear-cut forest. While wheat straw is renewable every year, replacing an acre of forest would take 30 years.

The panels are particularly suited to war-torn countries such as Iraq because they speed up the time it takes to build a house while significantly lowering the cost. It takes three workers only three days to construct one of Durra's 400-square-foot homes, and they don't need heavy-lifting equipment.

While the company hasn't yet figured out what its houses would sell for in Iraq, one of its 600-square-foot homes usually costs $15,000, said Charlie Daniel, Durra's vice president.

Daniel has spent more than a year and a half trying to figure out some way to get Durra's kits into Iraq. He initially met with a few government contractors, but the talks didn't lead anywhere.

"We generated interest, but we had a hard time getting anyone focused on it," Daniel said.

Now, with Kubba's support, he's hoping things will change.

Though the daily violence in Iraq has repeatedly delayed Durra's plans, it hasn't weakened the company's resolve.

"We feel it's certainly a viable project," Norman said. "There's a lot of wheat straw there."

Melvin Bowen, left, and Alvin Word stack construction panels at Durra Building Systems in Texas. The company hopes its cheap housing will catch on.

Durra's construction panels are made from wheat straw, once considered waste. This wheat has a future, possibly as affordable housing in Iraq.