producer - consume; how does the consumer stop?

A: There is simply no guarantee that just because peek returns null, the producer has stopped producing. What if the producer simply got slowed down? Now, the consumer quits, and the producer keeps producing. So the 'peek' -> 'break' idea basically fails.

B: Setting a 'done/run' flag from consumer and reading it in producer also fails, if:

1. consumer checks the flag, finds it should keep running, then does a 'take'
2. in meanwhile, producer was setting the flag to 'dont run'
3. Now consumer blocks forever waiting for a ghost packet

The opposite can also happen, and one packet gets left out un-consumed.

Then to get around this, you will want to do additional synchronization with mutexes over and above the 'BlockingQueue'.

C: I find 'Rosetta Code' to be fine source of deciding what is good practice, in situations like this:

http://rosettacode.org/wiki/Synchronous_concurrency#Java

The producer and consumer must agree upon an object (or an attribute in the object) that represents end of input. Then the producer sets that attribute in the last packet, and the consumer stops consuming it. i.e. what you referred to in your question as 'poison'.

In the Rosetta Code example above, this 'object' is simply an empty String called 'EOF':

final String EOF = new String();

// Producer
while ((line = br.readLine()) != null)
  queue.put(line);
br.close();
// signal end of input
queue.put(EOF);

// Consumer
while (true)
  {
    try
      {
        String line = queue.take();
        // Reference equality
        if (line == EOF)
          break;
        System.out.println(line);
        linesWrote++;
      }
    catch (InterruptedException ie)
      {
      }
  }

Do NOT use interrupt on Thread, but rather break the loop when not needed anymore :

if (queue.peek()==null)
         break;

Or you can also using a variable to mark closing operation pending and then break the loop and close the loop after :

if (queue.peek()==null)
         closing = true;

//Do further operations ...
if(closing)
  break;