Firefighters have extinguished a small grass fire at the Parkwood industrial estate, the area's third fire in over two months.

The fire started at the old tip at Parkwood, near the NSW border, just before 1pm.

Firefighters from ACT Fire and Rescue and the Rural Fire Service rushed to contain the fire.

It reached roughly 300 metres x 300 metres in size, but was extinguished within half an hour.

Firefighters were mopping up hot spots about 1.30pm.

The incident follows two mulch fires near the Parkwood industrial estate in the past two months.

A fire burnt through mulch at Canberra Sand and Gravel's Parkwood Road facility on December 6, caused by spontaneous combustion.

Another mulch fire occurred at Canberra Sand and Gravel on November 16, also caused by spontaneous combustion.

Each mulch fire took firefighters hours to fully extinguish, with crews forced to break up the mulch to get rid of hot spots.