The item can be created by leaving a rotable or already rotten piece of food, a dead fish, or a piece of shit on the "compost" terrain found in a farm; it can take a great deal of time before the change happens. Note that the compost terrain cannot be selected from the terrain menu of design mode, nor can be copied by right-clicking on an already existing compost. This means that if you created your farm in a pre-1.18 version and then upgraded to 1.18, or if you replaced all of the compost terrain with other terrain via design mode, the only way to get compost heaps is to reset the farm, which will cause all plants and all items in the farm to disappear.