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Seed starting mix is basically just sphagnum moss that had been screened to a light texture and mixed with pearlite or vermiculite. some, mfg. like MG put trace amounts of NPK in the mix...very low concentrations like 0.05% or whatnot. It DOES hold a lot of water, but that is great for starting the seedlings.
It sux that there were nasties in the soil you used. Was it fresh soil, or some that you had used before? Whenever I get done with a container, I dump it on my compost pile to cook for a few months before using it again in my pots or garden.
It's a shame you can't write the soil company, explain what happened and demand compensation for those seeds.
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