To clarify, chickens don't need bedding. They don't bed down on the floor, they roost. Whatever you put on the floor is simply "litter" as it is there to collect poop and provide a soft landing when they jump from the roosts.
In my early days of chicken keeping I had only roost bars and straw for "bedding". Straw molds easy and can house bugs and pests too easily as I quickly found out, so I switched to pine, which is a much more appropriate litter, not a bedding. Pine didn't mold as easily, but the amount of poop was amazing. I was constantly adding and adding and adding more pine shavings to try to offset the poop smell. It seemed very expensive.
Finally I learned about poop boards and installed one of those. The Chicken Chick has a good article about it. I lined the board with
Sweet PDZ (a horse stall urine odor eliminator, highly absorbent compostable, but dusty). I used a cat litter scoop and scooped the poop daily. So at that point I had the poop board and was using pine shavings. This worked pretty well, but the pine shavings broke down too much and were very dusty after only a couple of months. Still better than before!
https://the-chicken-chick.com/droppings-boards-because-poop-happens/
Later I switched to using
coffee grounds (bought from
Tractor Supply), and the coffee grounds were amazing. They smelled nice and I could scoop any stray droppings. They are dust free, compostable, and very nice. I started saving my own coffee grounds to replenish what was lost to scooping, but ended up building a coop 4.5x larger than my old coop, and I haven't had a chance to make the move to switch back to coffee grounds. Here are pictures of my old coop and my experiences with using coffee grounds in addition to a poop board:
https://humble-hills-homestead.com/2020/07/24/using-coffee-grounds-as-chicken-coop-bedding/
Since I've built a new coop, I didn't have enough coffee grounds for the entire floor, so I've switched from Sweet PDZ (which is dusty) on the poop boards to using coffee grounds. I bought five bags from
Tractor Supply, so when the pine shavings (which are VERY dusty) are depleted I will switch back to the coffee grounds entirely. I no longer keep pine shavings in the nest boxes, and instead started using squares of turf, which have been wonderful to clean. You can view my current setup here:
https://www.backyardchickens.com/articles/cluck-mansion.76239/
If your shed doesn't have a dirt floor, or it only has a plywood floor, I recommend getting some sort of plastic paneling (you can buy sheets of plastic used for cheap bathroom jobs to line the walls) or linoleum to put on the floor to protect the floor from moisture. Personally I do not keep the water in the coop unless the chickens have to be locked inside. Water adds too much moisture to the air and is too susceptible to spills. Still, poop has moisture too and you want to protect that floor.
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