The mud in the navel is a mixture of dead skin cells, debris, sweat, oil secretions, and fine fibers of clothing.
The belly button is a place where bacteria tend to gather, and the mud inside is mostly a mixture of dead skin cells, debris, sweat, oil secretions, and fine fibers from clothing that are naturally shed every day. These mixtures need to be cleaned regularly. Failure to do so may result in reddening of the navel, discharge, odor, itchiness or pain, and even infection.
It is not recommended to pick at the mud in the navel, as regular picking can lead to inflammation of the navel, and in severe cases, infection or abscesses in the abdominal wall.
Regular cleaning of the belly button is recommended by applying some soap to a damp washcloth and then gently rubbing the belly button to remove dirt and lint. Once you are done, just rinse off all the lather.