Hematite is a mineral, colored black to steel or silver-gray, brown to reddish brown, or red. Hematite is harder than pure iron, but much more brittle. Huge deposits of hematite are found in banded iron formations. Grey hematite is typically found in places where there has been standing water or mineral hot springs, such as those in Yellowstone National Park in the United States. The mineral can precipitate out of water and collect in layers at the bottom of a lake, spring, or other standing water. Hematite can also occur without water, however, usually as the result of volcanic activity.
Source: http://en.wikipedia.org/wiki/Hematite
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