This is a bluish mushroom given to you by Torgluuk. To prepare it, he has suggested bringing it to a ley line hidden in a cavern under the upper catacomb of the Falatacot. This mucor should be prepared to be useful. Consume it at your own risk.
See the Enhancing Mucor on how to obtain Enhanced Mucor, which you can apply to store-bought weapons from Kor-Gursha, in order to obtain some very nice quest weapons.