Ipswich-based County Mulch admitted breaching the Health & Safety at Work Act, during a hearing before Ipswich Crown Court on 17 January.
The court heard that Lithuanian Igor Popov was cleaning the underside of a conveyor belt that brought compost from the ovens when his arm became trapped and his hand was dragged into the machinery.
Doctors were later forced to amputate one of his fingers.
In mitigation it was said that management at the company had fully co-operated with the Health & Safety Executive (HSE) investigation and that safety requirements at the plant were upgraded immediately after the accident.
After the case, an HSE representative said: "This was a wholly preventable incident. Popov's injuries could and should have been avoided by straightforward safety precautions."
The company was also ordered to pay £9,000 in damages.