Well, Sedimentary rocks contain the largest iron ore resources on earth. In both freshwater and marine environments, iron and oxygen mixed in chemical reactions to make them. Hematite (Fe2O3) and magnetite are the two most significant iron oxide minerals in these deposits. Almost all of the iron and steel items we use today were made using these iron ores that were mined. Major iron ore reserves on Earth are almost entirely found in rocks that were produced more than 1.8 billion years ago. Oceans on Earth at that time had little to no dissolved oxygen and a lot of dissolved iron. When the first species capable of photosynthesis started releasing oxygen into the waters, the iron ore deposits started to emerge. The plentiful dissolved iron and this oxygen immediately interacted to form magnetite or hematite. These minerals were very abundant when they were deposited on the ocean floor, creating what are now referred to as "banded iron formations." The iron minerals deposited in alternating bands with silica and occasionally shale, which is how the rocks became "banded." Possible causes of the banding include seasonal variations in organism activity.
Put it in the simplest way for the second question:
Iron ore must first be collected from the ground and partially processed to eliminate the majority of the impurities before it can be utilized.
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