Straw, particularly when left on the soil surface, can retard cereal establishment and reduce crop yield and therefore, in Britain, it is often burned. Treatment with a microbial consortium attempts to eliminate the negative value of straw while using it as a fertilizer, soil conditioner and biocontrol agent. Cellulolytic fungi, preferably Trichoderma species which are parasitic on some plant pathogenic fungi, convert the cellulosic components of straw to sugars. These sugars become available for growth of an anaerobic N<latex>$_2$</latex>-fixing bacterium, Clostridium butyricum. Part of the N fixed in microbial biomass is recycled to the fungus to stimulate further cellulolysis and ultimately a product rich in N and with no phytotoxicity results. A third organism, Enterobacter cloacae, that produces copious extracellular polysaccharide is co-inoculated as an active member of a microbial community. The O<latex>$_2$</latex> consumption by E. cloacae and its associated gum aids respiratory protection of the anaerobe to form a consortium that is relatively insensitive to O<latex>$_2$</latex>. The gum has additional value as a soil conditioner.