Initially to stabilize the market. What was happening is the price of milk would tank and a lot of farmers turned their livestock into meat and left the business, which then resulted in a production shortfall, and skyrocketing prices, and the cycle began anew. So they came up with a plan to buy excess milk when prices were low, turn that into a higher value, longer lasting commodity to sell later. But once you introduce that by the government instead of private companies, removing it becomes a political maneuver. So it could only go up, and prices were kept artificially high.
If I recall correctly I’m pretty sure it was due to the government subsidies for the dairy industries to keep the prices up.
Initially to stabilize the market. What was happening is the price of milk would tank and a lot of farmers turned their livestock into meat and left the business, which then resulted in a production shortfall, and skyrocketing prices, and the cycle began anew. So they came up with a plan to buy excess milk when prices were low, turn that into a higher value, longer lasting commodity to sell later. But once you introduce that by the government instead of private companies, removing it becomes a political maneuver. So it could only go up, and prices were kept artificially high.