I found this out when I accidentally threw my pick axe out of my inventory while placing blocks and placed the block where the pick axe was and expected it to push out like it does, but it disappeared. Could not find it in caves beneath or anywhere I searched. To replicate, throw an item onto the ground. Place a block at the item position and it will disappear. Only tried with steak item and pick axe, though I'm betting it's like that for all items.