what does it mean?

Question

the cellulosic vegetation is decomposed into carbon & minerals by the saprophytic fungi & these elements are returned to the same environment from where they were obtained.

Answer 1

The fungus digests the dead material in its environment recycling it to be used again.

Answer 2

Plant cell walls are made up with cellulose. (This is known as dietary fiber to us because we can't digest it.)
A brown rot fungus selectively removes the cellulose compounds from the wood, leaving the brown lignin behind as humus. A white rot fungus digests lignin and leaves white cellulose behind. Both are kinds of saprotrophic fungi.

A saprotrophic fungi consumes only dead wood, manure or bodies.http://www.hiddenforest.co.nz/fungi/class/how.htm
http://www.anbg.gov.au/fungi/ecology-woodrot.html

With out the efforts of the fungi dead material would accumulate, filling the world with detritus. Instead plant material is recycled continuously. Fungi are not the only recyclers but they are a major portion of it.

Answer 3

Sounds like someone translated "ashes to ashes, dust to dust" into jargon.