It needs to be dry, otherwise it will freeze just like dirt over the pan. I know a lot of guys who use the dirt from large anthills, they carry it along with them and when they make the dirt hole set they carry the dirt they remove from the area away and scatter it around some distance from the set. We have anthills in northern PA that can be three feet high and a couple of feet in diameter. The dirt on these anthills because f a secretion by the ants actually repels water enough to keep your trap from freezing. Some trappers actually buy flaked paraffin wax and mix it with clean loamy dirt to use to cover their traps.