It's the first time the USDA program that buys surplus products has purchased liquid milk.
The acquisition is not related to the emergency assistance for farmers linked to President Donald Trump's tariff proposals, although dairy farmers have been hurt by trade issues related to NAFTA and declining demand for milk from cows.
The USDA is buying the milk under a program that allows the government to buy surplus food or agricultural products and redirect them to food banks or school-nutrition programs.
Hundreds of dairy farms have closed, citing economic pressure and government regulations, over the last 15 to 20 years. The Los Angeles Times reported that Califonia Republican Congressman David Valado lost his family farm this year and that 36 percent of dairy farms in the state closed between 2001 and 2017.
Industry and advocacy groups have called on the government to help.
"This purchase addresses one of our country's significant challenges -- hunger -- and, at the same time, will have a positive impact on the dairy industry at a time of significant market uncertainty," said Michael Dykes, the International Dairy Foods Association president and CEO. "The nation's milk processors welcome the opportunity."