Nectar is fed to all of Furnace's creatures, either through the needle or by direct ingestion. It has the effect of the equivalent of adrenaline, spurring the occupant into a rage-like state. Wounds are quickly healed under the effect of nectar and the pain is also very much muffled, if not deadened entirely.
The Nectar finds its origin in the creature called 'The Stranger'. This being had supposedly existed since "before mankind stepped onto the earth." It was considered an entity of evil in the book, even by Furnace himself.
Furnace gained the power of nectar from the Stranger in the mid-19th century, his natural era. In the German town he lived in he and his brother went into the orchard like regular children might. Sadly, the Stranger killed Furnace's brother while in the orchard and he was prosecuted for the crime by the fellow villagers. He was disemboweled in the orchard by the villagers and the Stranger gave him an out to 'save' his life. If Furnace were to drink the Stranger's blood he essentially kill the Stranger and avenge his brother. The only catch was that he became the Stranger.
After gaining the ability of the Stranger, Furnace went on an uncontrollable killing spree of pure rage. Wanting to build an army and share his power, he started to test giving his undiluted blood to normal people. Although they were very powerful for a period of time they soon died afterwards because of the power of the blood.
By the early to mid-10th century, he had found the right dilution of his blood to be able to feed to others. Quickly he built up a mercenary-like army used during the World War era. Only when Furnace developed the yellow-speckled nectar did his army move closer into the modern era.
This nectar was given in mass to Warden Cross for the Furnace Penitentiary. This was used to convert Blacksuit from prisoners and helped in the selection of Berserkers to be used as Furnace's warrior-pets. It was also what had built up the basis of Alex Sawyer's nectar-pumped body.
Next, the red-speckled nectar was created. This was well after the inception of the penitentiary and was therefore not provided for Warden's projects. The perks provided by this nectar over its previous model were vital to his attempt of world domination. In addition to being plenty more powerful, it allowed for the nectar to spread like a plague, turning viable subjects into the end product by injection - or better, infection - solely. No long surgical and psychological transformation was required. Being bit by a Berserker or a Rat would result in death or an immediate conversion with unprecedented strength, even for the nectar.