Pure hematite has a composition of about 70% iron and 30% oxygen by weight. Like most natural materials, it is rarely found with that pure composition. This is particularly true of the sedimentary deposits where hematite forms by inorganic or biological precipitation in a body of water.

Minor clastic sedimentation can add clay minerals to the iron oxide. Episodic sedimentation can cause the deposit to have alternating bands of iron oxide and shale. Silica in the form of jasper, chert, or chalcedony can be added by chemical, clastic, or biological processes in small amounts or in significant episodes. These layered deposits of hematite and shale or hematite and silica have become known as the “banded iron formations” (see image).