This is a complicated and inter-reactive process that can be viewed from different positions.
Blood is composed of Nutritive Qi and Body Fluid, both of which come from the essential substances of food and water transformed by the Spleen and transported to the Lung, where they meet with fresh air from respiration. Through the transformational activity of Lung-Qi, Nutritive Qi and Body Fluid interact with extracted oxygen and change into a red liquid. The liquid travels to the Heart to permeate the blood vessels as Blood.
The basic substance for producing Blood is the Essence, including the congenital Essence and the acquired Essence. The Essence stored in the Kidneys produces Marrow, which contributes to making the key elements of Blood. The transformation of the Essence into Blood is a process of Qi transformation.
As explained above, the main organs involved in blood production are the Heart, Lung, Spleen, and Liver. The Lung participates in the production of Nutritive Qi by inhaling fresh air from the outside. Also, the Liver regulates Qi activity and influences Qi transformation in the Marrow to create the body’s blood cells. With its dredging and dispersing functions, the Liver exerts an effect on the production of Blood. The blood circulation still relies on the combination of the viscera’s functions.