What's this nastiness on the bottom of my new apple tree?

I fear it's a canker but wondered what others think. It's a young apple tree which seems to be otherwise thriving although the wind blew a branch off it yesterday.... It was only planted last autumn in unfortunately quite waterlogged conditions due to the floods last year. It's looked fine until I noticed this today. Worried it's root rot setting in basically. Would it have done this well up to now if this was the case? Can anything be done?

 

Looks like a bit of bark has been knocked off.
Is that dung round the bottom?
I'd move it away a bit, leave a gap between that and the base of the tree.

 

It's just mulch although it does look a bit dungy It's well below the root graft though right? If I cleared it any more the roots would be exposed...

 

Normally you plant the tree in the ground and mulch the root area, keeping the mulch away from the stem a bit.
Is it planted shallow with the roots exposed and only covered by the mulch?

 

It's basically mulched to the trunk. I didn't realise you're not meant to do that. I'm quite a novice in case you didn't guess... what should I do then? Clear the mulch and fill in with regular soil?

 

Well, are the roots really that near the surface, if they are then its probably best left.
Cant see a real problem with the base of the tree apart from that piece of bark missing.