To provide for a gradual reduction in the loan rate for peanuts, to repeal peanut quotas for the 2002 and subsequent crops, and to require the Secretary of Agriculture to purchase peanuts and peanut products for nutrition programs only at the world market price.

Amends the Agricultural Market Transition Act to reduce quota peanut price support levels through crop year 2001 and make nonrecourse loans available to all peanut producers at 85 percent of estimated market value as of crop year 2002. Amends the Agricultural Adjustment Act of 1938 to eliminate peanut quotas as of crop year 2002. Amends the National School Lunch Act to authorize the...