Firstly you need wood for a pickaxe. Next you'll need to mine down at an angle until you get to stone, Use this stone to create a furnace (8 Cobblestone. Found in the crafting table
menu). Now you want to mine into your mine until you find a version of stone with pink pixel on it. This is Iron which can only be mined with a stone pickaxe
Now to smelt the Iron you need either Coal, Charcoal or logs. If you found coal while looking for Iron put it on the bottom section of the furnace, if not then Charcoal can be made by smelting wooden logs with wooden logs or to completely bypass that section just smelt the iron with the logs.
And now you have the achievement
What you'll need
* Wood (To be used to create a Crafting table and sticks for tools)
* Stone (To create the furnace and stone pickaxe)
* Crafting Table
* Wooden and
* Iron Ore
A patch has been released that reportedly fixes the bugged achievements, making this achievement obtainable again.
EDIT: Some people are reporting this achievement to not be unlocking when it is supposed to. The To get around this Soundgoodizer suggested creating a new world and do everything from scratch by yourself, and repeat it until you get the achievement,