Stranded Deep

I found the barrel scrap needed to craft the Hobo Stove when exploring the second island I reached (third if you include the starter island). Like with tires on some of the boats I explored around the first two islands, there were bunches of barrels tied together in or on some of the boats around the third island. Striking them with an axe breaks apart the string holding them together, and you can then grab and drag one back to shore. They do not go into your inventory and they are a bit awkward to drag, so be mindful of sharks while you swim!

Drag and place it next to your fire pit, or build one if you haven't already; then you can stand next to them and open the crafting screen to choose Hobo Stove. Like with all crafted items make sure its placed correctly and turns white, then craft and hey presto! Your very own Hobo Stove :)