What is composting?
Composting is the process by which organic residues are decomposed (under controlled conditions) to a humus-like material that is an excellent soil amendment. The benefits of composting are many including reduction of material in the "waste" stream, reduced reliance on synthetic chemical inputs in the farm and garden landscape, and increased productivity in the farm and garden systems. 
Source: http://academics.sru.edu/MacoskeyCenter/Demonstration/composting.htm
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