Iron ore is the raw material required to make pig iron, which is the primary (98%) raw material used to make steel. Pure iron ore is virtually unknown on the surface of the Earth except as Fe-Ni alloys from meteorites and very rare forms of deep mantle xenoliths. Therefore, all sources of iron used in industry exploit iron oxide minerals, one of the primary forms of which is hematite. World resources of iron ore are estimated to exceed 800 billion tonnes of crude ore containing more than 230 billion tonnes of iron,

implying an average iron content of 28.75%.Iron ore consists of oxygen and iron atoms bonded together to form the iron-oxide molecule and needs to have the oxygen removed through smelting to create a purer iron product. During this process, the iron ore is heated to extreme temperatures in blast furnaces where lump ore is more stable and therefore preferred. By comparison, iron fines must be sintered before charging to the furnace. The premium associated with lump ore has persisted historically, reflecting the approximate costs required to sinter iron fines, the availability of furnaces required and other benefits including ease of transportation.