Question: What happens when ...

Question: What happens when nitrate contaminated drainage water is diverted to soils with high iron content? Will it form ferric nitrate? If then, what are the dangers of ferric nitrate to ecology

Nitrates in water promotes nitrification where proteins in nitrates promotes the growth as it decomposed.Ferrous in soil will have another effect on its own and it varies with the type of crops that you planted in your soil(that is if you are referring to agricultural soils).

If your concern is the reaction once it gets in contact with each other, the resulting mixture  will be the same as ferrous dont react with nitrates(please refer to emf series).Unless you specified the form of iron compound and the form of nitrate compound with its concentration then we can look at other compund that it can create. For now, a nitrate is a nitrate and a an iron is an iron in certain condition. No reaction.