Just to add to above, found this on another site, which gives ways to mix sawdust and explains why there is a problem.
woody
Sawdust, while void of weed seeds, pests, and diseases, in its raw state contains the poison phenol. When used in the raw state, nitrogen is drawn from the plants causing a nitrogen deficiency. Bacteria need increased nitrogen as they digest the high carbon content of the sawdust. Instead of the nitrogen going to the plant, it goes to the bacteria. Prevent this by adding more nitrogen.
Simply remove the phenol by positioning the sawdust heap in a location where runoff can leach away. Place on a slope or a mound of soil. Water it well and turn weekly for a month and then leave until you require it in the garden. The longer the heap is left, the better the product. The leaching will be dark and staining on timber and concrete. A potting mix containing wood materials will leach away the stained water after first potted. Consider this when placing newly potted plants on balconies.
How-to
Make sawdust safe by composting. Consider the following three methods, adapted from Queensland Gardener, May 1986:
Use sawdust in the garden compost pile in the ratio of 5 parts sawdust, 1 part fowl manure, 3 parts grass clippings and weeds, 1 part leaves, 1 part cow or other manure and add blood and bone in the pile building process. Construct the pile in the manner mentioned in my compost article.
Compost by adding a cubic metre of sawdust to 1/3 to 1/2 of chicken litter or 1/3 fowl manure. The finished product looks similar in texture to the original sawdust and suitable for gardens.
Dilute 2.5 kg urea in water and spray onto or mix in about 150 to 170 litres of fowl manure for every cubic metre of sawdust. (A 2 gallon buckets holds about 10 litres.) Water the pile well and turn it a few times over the initial two weeks. Following this, the toxic phenols should be removed. There will be little nutrition in the composted sawdust, so add manure or natural fertiliser in the usual manner.
