Game Mechanics: Moss Fungus Deleted

[spindok]

Hey - new player here

Did the mossy fungus quest - had lots of fungus so I decided to make multiple bottles of fungus but when I made the second one it said I can only have 1 lore item and then just completely deleted the fungus and I got nothing.

is this a bug? -- seems like if I can't have 2 lore items it should at least give back my fungus instead of punishing me or is that just how its supposed to be?