I found a decently sized node of iron ochre which I mined using my stone axe until I had enough for an anvil, hammer, and pick axe. This would yield me roughly 3 bars per ore smelter (25 pieces of ore). This is in line with what the wiki says is the chance of getting iron from iron ochre (12%).
But ever since I've started mining it with a pickaxe, based on the last four smelter's results, I seem to only get one bar per 25 pieces of ore (4%). During this whole time I've only had the tunneling skill. Is this just bad luck or am I missing something?