Systems engineering was used to identify peanut grading system needs, establish requirements, and compare proposed solutions that meet consensus specifications established by all industry segments. Previous attempts to change the grading system were hindered by difficulty in getting all segments to agree on proposed changes. The systems engineering approach overcame this obstacle. Four conceptual designs that improve the current system are at various stages of development and implementation. These improvements are: high moisture foreign material identification; measuring moisture during sampling; measuring single kernel moisture; and grading larger samples with an automated sample cleaning, shelling, sizing, and data collection system. Each of these improvements help ensure consumer demands for quality are met while not unfairly burdening any one segment of the peanut industry.