Is it bad to dispose of Sawdust & wood shavings on my garden?
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Your wife is correct on this one. Here are a couple links for you . . .
http://davesgarden.com/community/forums/t/982179/#b
https://gardening.stackexchange.com/questions/8262/what-can-i-use-sawdust-for-in-a-garden/8308
I too do woodworking and have spread my sawdust on the lawn with no ill effects, however, if you mix your sawdust into the top layers of dirt you have to add nitrogen to the soil as the wood decomposition in the soil will take most of the available nitrogen from the soil in the decomposition process which it returns as it decomposes. Spreading wood shavings and sawdust on top of the ground does not affect the soil this way and I use this on thin grass areas to protect the dirt until the grass grows back.
Bill I would not use in flowerbeds near the house as it might attract termites Otherwise lightly dispersed over your lawn would probably be ok.
Wood chips & sawdust rob soil of much-needed nitrogen, but once it is decomposed, it becomes beneficial to soil. If you're using it around perennial flowers, shrubs, and around fruiting trees, you can use it right away. If you're using it in soil as compost, you'll need to allow it to naturally break down for 2 years, then it is great!
Wood shavings and sawdust need to be composted. Spreading it in the garden and lawn will take forever for it to break down. It also will attract ants, termites, and other bugs.