US investigators search for remains of Aussie girl Zahra Baker, believed murdered.

POLICE in the US are searching a property for the remains of missing Australian 10-year-old Zahra Baker, with a cadaver dog reportedly leading investigators to a mulch pile and a wood chipper.

Zahra, who has twice survived cancer, is hearing-impaired and an amputee, was reported missing on Saturday by her stepmother, Elisa Baker, and father, Adam Baker.

But yesterday, tearful local police told a media conference that they believed her disappearance was a homicide.

About 50 police searched a property off Hartland Rd, Hickory, in Burke County, North Carolina, which belongs to the family of a foreman at the tree trimming company where the girl's father works, WCNC TV reported.

Alvin Webb, who lives next door, told NewsChannel 36 a deputy told him a cadaver dog smelled human remains on a mulch pile and on a wood chipper on the property.

Chief Tom Adkins, head of North Carolina's Hickory Police Department, choked back tears when he announced at a press conference an Amber Alert issued on Saturday to find Zahra was cancelled and the missing person case had switched to a murder investigation.

Zahra's American stepmother, Elisa Baker, is due in court overnight (AEDT) after she was charged with obstruction of justice for writing a fake ransom note demanding $US1 million.

The note was discovered on a car parked outside the family's Hickory home by police investigating a fire in the Bakers' yard.

It read: "Mr Coffey, you like being in control now who is in control we have your daughter."

Mr Coffey was identified as Adam Baker's boss, but police determined that Mr Coffey's family was safe.

"Elisa Baker admitted to writing the ransom note left on the vehicle," Chief Adkins told a media conference ealier today.

Plea for more clues

Chief Adkins said apart from Zahra's father and stepmother, no one can confirm seeing the girl the past month.

He said "information" police had received pointed to an "inspector" visiting the home, but that had not been verified.

"We need the public to come forward if they think they have seen Zahra within the (one month) timeframe," he said.

Zahra, whose bone cancer left her with a prosthetic leg and hearing aids, was born in Wagga Wagga, New South Wales, and spent time in Newcastle before moving north to Townsville, Queensland.

Zahra moved to the US from Australia with her father Adam two years ago, when he married Elisa after meeting her on the internet.

Zahra's biological mother lives in Australia.

"Horrible home life"

Brittany Bentley, married to Elisa Baker's nephew, told US TV network CBS Zahra was regularly beaten by Elisa Baker and locked in her bedroom for most of the day, allowed out for just "five minutes" to eat.

"She was beat almost every time I was over there for just the smallest things," Ms Bentley told CBS's Early Show.

"Elisa would get mad, she would take it out on Zahra, things the kid didn't deserve. She just had a horrible home life."

Australian friends in shock

Family friend Kim Wright became a family friend through a fundraising drive to help with Zahra battle against her illness.

"She was the most determined little girl I have ever met," Ms Wright told The Townsville Bulletin.

"She was going to still do everything she could, despite not having her leg or her hearing.

"I can only imagine what poor Adam is going through - he really loved her, and there is no way he would ever hurt her."