An agricultural waste, the wheat stalk, was used for the extraction of microcrystalline cellulose (MCC) and nanocrystalline cellulose (NCC) via a series of thermochemical and mechanical treatments. The MCC and NCC were then compounded with the biodegradable polymer, poly(butylene adipate-co-terephthalate), PBAT, by melt mixing. The properties of the composites were evaluated by soil composting, contact angle and water absorption measurements, scanning electron microscopy (SEM) and gel permeation chromatography (GPC). The cellulosic filler was found, as per SEM results, to uniformly disperse in the polymer matrix forming a quite homogeneous composite which visibly degraded completely within a few months under soil composting and showed high water absorption, these properties being enhanced with the filler content. Compared to the neat PBAT, the composites showed enhanced surface hydrophilicity thereby increasing the ability of degradation. In spite of seemingly remarkable change in mechanical stability of the polymers under soil burial for several months, relatively low lowering of the molecular weight was observed.