Organic Matter has to be present in the soil for plants to grow. That's why deserts are simply 'deserts' - not sandy soils!
A soil rich in organic matter (Humus) will both hold moisture, and allow surplus moisture to drain away! How? Organic matter acts as a sponge in collecting and holding onto soil moisture, but it also helps the soil to form a good 'crumb structure'. That is to say, that it assists the individual soil particles to group together into larger groupings - or crumbs. This then allows the soil to become more workable or friable; instead of being one solid mass.
A friable soil has an open structure, which allows air into the small spaces between the individual crumbs. Roots need oxygen. It also allows soil moisture to percolate into these spaces. Soil moisture holds nutrients. It also allows the roots to 'travel' and seek out this air and ready supply of nutrient.
Organic matter/humus also breaks down (rots away) and releases nitrogen into the soil, which is absolutely vital to plant growth. The ultimate in recycling! You put all of your dead plant/vegetable matter into the soil; it breaks down into Nitrogen which is the main ingredient needed for new plant growth.
Make sure that any organic matter you add to the soil is already on the way to rotting! All plant and vegetable waste should be 'composted' first, before being added to the soil. Peat, composted bark, rotted stable manure and the like are all ready to use.
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