The problem is that we need the nappies to be stored for months as they are transported and ready in warehouses. And they need to be able to handle a lot of abuse while wearing them. Among other they need to be watertight and absorb all the liquids. These requirements are contradictory to being compostable. It is hard to make something watertight and durable and at the same time decompose when you want it, but not before.
Strictly speaking the reusable cloth nappies are actually compostable. These are usually made of wool or cotton which does compost quite nicely. But they are far too expensive to be disposable.
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