Iron Bars require five pieces of Iron Ore and one piece of Coal; these must both be placed inside the Furnace in order to create an Iron Bar. If you do not have the Furnace, you can craft it once you receive the recipe from Clint (which will be provided after Mining one piece of Copper Ore). When you are ready to create a Furnace, you require 20x Copper Ore pieces and 25x Stones.