SECURITIES AND EXCHANGE COMMISSION

                           Washington, D.C.  20549
                               _____________

                                 FORM 10-Q


                Quarterly Report Under Section 13 or 15(d)
                  of The Securities Exchange Act of 1934


For Quarter Ended September 30, 1996 Commission file number 0-14825

                              SEALRIGHT CO., INC.
           (Exact name of registrant as specified in its charter)


          Delaware                              16-0876812
  (State or other jurisdiction of             (IRS Employer
   incorporation or organization)           Identification No.)

  9201 Packaging Drive, DeSoto, Kansas                66018
   (Address of principal executive offices)         (Zip Code)


Registrant's telephone number, including area code  913-583-3025


   7101 College Boulevard, Overland Park, Kansas  66210-1891     
Former name, former address and former fiscal year, if changed since
last report.

Indicate by check mark whether the registrant (1) has filed all 
reports required to be filed by Section 13 or 15(d) of the Securities 
Exchange Act of 1934 during the preceding 12 months (or for such 
shorter period that the registrant was required to file such reports), 
and (2) has been subject to such filing requirements for the past 90 days.

(1) Yes     X     No             (2)  Yes    X     No        

As of September 30, 1996, Sealright Co., Inc. had 11,071,991 shares of 
Common Stock outstanding.  The market value of stock held by non-
affiliates is approximately $71,943,000.

             SEALRIGHT CO., INC. AND SUBSIDIARIES
    
                          FORM 10-Q

                       November 1, 1996



                 PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

                      INTRODUCTORY COMMENTS
The Consolidated Financial Statements included herein have been 
prepared by Management, without audit, pursuant to the rules and 
regulations of the Securities and Exchange Commission.  Certain 
information and footnote disclosures normally included in financial 
statements prepared in accordance with generally accepted accounting 
principles have been condensed or omitted pursuant to such rules and 
regulations, although Management believes that the disclosures are 
adequate to enable a reasonable understanding of the information presented.
It is suggested that these Consolidated Financial Statements be read 
in conjunction with the financial statements and the notes thereto 
included in the Company's Annual Report on Form 10K, for the year 
ended December 31, 1995.

Except for historical information contained herein, the matters set 
forth in this report or in oral statements made by officers of the 
Company are forward looking statements that involve certain risks 
and uncertainties that could cause actual results to differ materially 
from those in the forward looking statements.  The Company's expectations 
respecting future revenues and profits assume, among other things, 
reasonable continued growth in the general economy which affects demand 
for the Company's products, reasonable stability in raw material pricing, 
changes in which affect customer purchasing decisions as well as the 
Company's revenues and margins, and successful execution of the Company's 
previously announced restructuring plan.

The costs and benefits of the Company's restructuring and facility 
consolidation plan may vary from the Company's original expectations due 
to various factors such as:  the extent of management's ability to control 
costs, inefficiencies, overheads and operational issues during the 
transition period; sales prices realized upon future disposal of redundant 
assets, particularly real property which is subject to future supply and 
demand conditions in various real estate markets; higher or lower than 
anticipated rates of relocation or resignation of employees who otherwise 
would receive termination payments and difficulties inherent in forecasting 
results of an operating mode different from that which exists at the time 
the forecast is made.  Investors are also advised to consider other risks 
and uncertainties that may be discussed in documents filed by the Company 
with the Securities and Exchange Commission.


                    SEALRIGHT CO., INC. AND SUBSIDIARIES
                       CONSOLIDATED INCOME STATEMENTS
               FOR THE PERIODS ENDED September 30, 1996 and 1995
                    (In Thousands Except Per Share Data)
                                  (Unaudited)


                                  Three Months        Nine Months
                            Ended September 30  Ended September 30
                                1996      1995       1996     1995  

Net Sales                      $68,419   $76,151   $209,214 $230,824
Cost of Sales                   55,542    63,237    173,790  187,109      
    Gross Profit                12,877    12,914     35,424   43,715 

Selling, Gen. & Admin. Exp.      7,775     9,561     25,085   27,043  
Other Expense                      270       365        753    1,148

Restructuring Expense              815       --       3,264      -- 

Operating Income                 4,017     2,988      6,322   15,524

Interest Expense                 1,318     1,243      4,050    3,743  

Income Before Income Taxes       2,699     1,745      2,272    11,781

Provision for Inc. Taxes           975       698        814     4,695
 
NET INCOME                     $ 1,724   $ 1,047   $  1,458  $  7,086
 
NET INCOME PER SHARE           $  0.15   $  0.09   $   0.13  $   0.64

AVERAGE NUMBER OF COMMON 
  AND COMMON EQUIVALENT 
  SHARES OUTSTANDING            11,072    11,072     11,072     11,095         



                     SEALRIGHT CO., INC. AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
                    September 30, 1996 and December 31, 1995
                                (In Thousands)
                                  (Unaudited)

                                     September 30, 1996   December 31, 1995
                                   ASSETS
Current Assets
Cash                                       $      8         $  6,017
Accounts Receivable                          28,596           22,591
Inventories (Note 3)                         43,844           39,848
Other Current Assets                          3,448            2,639
       Total Current Assets                  75,896           71,095
Property, Plant & Equipment                 249,804          240,065
Less:  Accumulated Depreciation             108,364           97,762  
Property, Plant and Equipment, Net          141,440          142,303

Intangibles, Net                             11,354           12,115
Other Assets                                  2,215            2,584
TOTAL ASSETS                               $230,905         $228,097

                     LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Current Maturities of Long-Term Debt      $   6,200         $  6,200
Accounts Payable                             14,905           12,874
Accrued Vacation                              3,103            3,253
Accrued Workers' Compensation Reserve         2,354            2,675
Restructuring Liability                       1,192            3,259
Accrued Liabilities                           6,578            1,989
   Total Current Liabilities                 34,332           30,250
Long-Term Debt                               81,350           77,400
Deferred Income Taxes                        12,061           14,168
Post-Retirement Benefits                      2,381            2,241
Pension Liability                               917              917
Restructuring Liability                         375            1,105
TOTAL LIABILITIES                           131,416          126,081

Stockholders' Equity
Common Stock, Par Value $.10
  Authorized 20,000,000 shares;
  issued and outstanding 11,071,991
  as of September 30, 1996 and
     December 31, 1995, respectively          1,107            1,107
Paid-In Capital                              14,911           14,911
Retained Earnings                            83,471           85,998
   Total Stockholders' Equity                99,489          102,016

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $230,905         $228,097




                   SEALRIGHT CO., INC. AND SUBSIDIARIES
                    CONSOLIDATED STATEMENTS OF CASH FLOWS
     FOR THE NINE MONTHS ENDED September 30, 1996 and September 30, 1995
                              (In Thousands)
                                (Unaudited)

                                                    1996         1995

Cash Flows from Operating Activities:
Net Income                                       $  1,458     $  7,086     
Adjustments to Reconcile Net Income to Net
  Cash Provided by Operating Activities:
     Depreciation & Amortization                   15,007       14,697
     Deferred Tax Provision                         1,530        3,127
     Changes in Assets and Liabilities:
       Accounts Receivable, Net                    (6,680)      (4,288)
       Inventories                                 (3,996)      (3,202)
       Accounts Payable                             2,623        2,276
       Other                                       (2,448)      (1,420)
          Total Adjustments                      $  6,036     $ 11,190     
Net Cash Provided By Operating Activities        $  7,494     $ 18,276     
Cash Flows from Investing Activities:
  Capital Expenditures                           $(13,603)    $(16,814)
  Proceeds from Disposal of Equipment                 106          157
Net Cash Used in 
  Investing Activities                           $(13,497)    $(16,657)    

Cash Flows from Financing Activities:
  Net Borrowings Under Revolving 
    Credit Agreement                             $  8,000     $  7,000          
  Proceeds from Common Stock Issued                   --           165
  Principal Payments of Long-Term Debt             (4,017)      (5,151)
  Dividends Paid                                   (3,989)      (3,982)    
Net Cash Used in Financing Activities            $     (6)    $ (1,968)    

Net Decrease in Cash                             $ (6,009)    $   (349) 
Cash, Beginning of Year                             6,017        1,057

Cash, End of Nine Months                         $      8     $    708



                    SEALRIGHT CO., INC. AND SUBSIDIARIES

                                   10-Q

                             SEPTEMBER 30, 1996

                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1 - FINANCIAL STATEMENT PRESENTATION
In the opinion of Management, the accompanying unaudited consolidated 
financial statements contain normal interim adjustments necessary to 
present fairly the financial position of Sealright Co., Inc. and 
Subsidiaries as of September 30, 1996 and December 31, 1995, and 
the results of their operations for the periods ended September 30, 
1996 and 1995.

NOTE 2 - ACCOUNTING PRINCIPLES AND POLICIES
The accompanying financial statements have been prepared consistent 
with the accounting principles and policies described more fully 
in Note 1 of the Company's Annual Report for the year ended 
December 31, 1995.

NOTE 3 - INVENTORIES
Inventories at September 30, 1996 and December 31, 1995, were:

                                                 1996    1995
                                                (In Thousands)
Inventories Carried on LIFO Basis
  Raw Materials                                 $16,154 $13,395
  Work-In-Process                                 5,175   9,163
  Finished Goods                                 18,126  12,714
                                                $39,455 $35,272

  LIFO Reserve                                   (1,470) (1,466)
Inventories Carried on LIFO Basis               $37,985 $33,806
Inventories Carried on Average or FIFO Basis      5,859   6,042
                                                $43,844 $39,848

Because the inventory determination under the LIFO method can 
only be made at the end of each fiscal year based on the 
inventory levels and costs at that time, interim LIFO 
determinations, including those at September 30, 1996, must 
necessarily be based on management's estimate of expected year-end 
inventory levels and costs.  Since estimates of future inventory 
levels and prices are subject to many factors beyond the control 
of management, interim financial results are subject to final 
year-end LIFO inventory amounts.  Accordingly, inventory components 
reported for the period ending September 30, 1996, are estimates 
based on management's knowledge of the Company's production cycle, 
the costs associated with this cycle and the sales and purchasing 
volume of the Company.

NOTE 4 - STATEMENTS OF CASH FLOWS
     Supplemental cash flow information for the nine months ended 
     September 30, 1996 and 1995 is (in thousands):

                                                  1996    1995
     Interest Paid (Net of Amount Capitalized)  $ 4,081 $ 3,880
     Income Taxes Paid                              317   1,530































ITEM 2.

             MANAGEMENT'S DISCUSSION AND ANALYSIS OF OPERATIONS
                           AND FINANCIAL CONDITION

Results of Operations

Year-to-date net sales were $209.2 million, down $21.6 million or 
9.4 percent, from 1995.  Net sales for the third quarter of 1996 
were $68.4 million, a decrease of 10.2 percent from the same quarter 
of 1995.  For the quarter, sales of rigid paperboard products were 
down 10.8 percent while sales of flexible packaging products were 
down 9.2 percent from the same quarter of 1995.  Sales at the Company's 
subsidiary in Australia were up more than 200 percent ($630) thousand from 
last year reflecting the Company's expanding international presence.  The 
revenue decline for both the year and the quarter is attributed to
three factors.  First, cool, wet weather coupled with rising raw material 
costs for the dairy industry, primarily butterfat, reduced demand for the 
Company's frozen dessert packaging by $3.4 million for the quarter and
9.5 million year-to-date from the same period last year.  Secondly, the 
Company had $8.0 million and $2.8 million of revenue year-to-date and 
the quarter ended September 30, 1995, respectively, from customers 
that were lost in late 1995 and early 1996.  Finally, the Company lost 
several accounts due to unanticipated factors.

Gross profit year-to-date was $35.4 million compared to $43.7 million 
a year ago.  Gross profit for the quarter was $12.9 million, or 18.8 
percent of net sales.  During the third quarter of 1995, the Company's 
gross margin was 17.0 percent.  The increase in gross margin, despite 
the $7.7 million decline in revenue, reflects the Company realizing 
the expected efficiency benefits from its restructuring plan.  The 
inefficiencies sustained during the first and second quarter as a 
result of moving the Company's DeSoto, Kansas rigid paperboard 
operations to Fulton, New York and Los Angeles, California have 
diminished.  Both facilities' performance has improved.  The Company's 
gross margin in the third quarter improved from the first and second 
quarters of 1996 in both rigid and flexible packaging operations.  
However, the Company continued to suffer from losses at its Los Angeles 
rigid plastics operation due to significant inefficiencies encountered 
during the conversion to new thermoforming equipment.  The operating 
loss for the third quarter was $800 thousand and the loss year-to-date
was $2.3 million.

Selling, General and Administrative expenses year-to-date are down 
$2.0 million, or 7.2 percent, from 1995.  SG&A expenses for the 
quarter are down $1.7 million, or 18.7 percent, from the same period 
last year.  These reductions are primarily due to staffing reductions 
as part of the Company's restructuring plan coupled with continued cost 
cutting initiatives.  The Company has eliminated approximately 70 
salaried positions since last September. 

The Company has been incurring restructuring expenses during the year 
as a result of moving equipment and personnel involved with the plant 
consolidation plan announced in late 1995.  Additionally, other costs 
associated with the restructuring such as employee recruiting and 
management reorganization are classified in this category.  Restructuring 
expenses year-to-date have been $3.3 million, and $0.8 million for the 
third quarter.  Restructuring expense during the quarter reflects costs 
associated with moving the Company's machine manufacturing operations, 
research and development center and Corporate Office to the DeSoto 
facility.  Restructuring expense is expected to be approximately $2.3 
million during the fourth quarter as the Company consolidates its 
Charlotte and Raleigh, North Carolina facilities. 


Interest expense year-to-date was $4.0 million, or 8 percent higher 
than last year, reflecting a higher level of debt coupled with reduced 
interest capitalization.  Capital spending is 19 percent lower than 
last year reducing the amount of associated interest expense 
capitalization.  Interest expense for the quarter is 6 percent higher 
than last year as a result of the same factors.


Liquidity and Capital Resources

  Net cash provided by operating activities for the nine month 
period ended September 30, 1996, was $7.5 million compared to 
$18.3 million for the same period in 1995.  The primary cause of the 
reduction year over year has been the reduction in the Company's level 
of net income.  Earnings are down primarily due to reduced net sales, 
losses at the Company's rigid plastics facility and additional expenses 
associated with the ongoing restructuring.  Accounts receivable and 
inventories reflect higher dollar and percentage increases from the 
beginning of 1996 versus 1995 due to aggressive management of these two 
asset classes in the fourth quarter of last year, resulting in low 
year-end levels of receivables and inventory.  Capital expenditures 
year-to-date were $13.6 million, which is 19 percent lower than the 
same period last year.  Capital spending has been directed at 
modifications to facilities to accommodate equipment consolidation, 
cost savings initiatives and the Company's new management information 
system.

At September 30, 1996, the Company had borrowed $8.0 million against its 
$30 million bank line of credit at an average interest rate of 5.95%.  
The remaining $22 million of available credit is significantly more 
than the Company's anticipated needs for working capital and investment 
spending for the balance of the year.

The Company must comply with various financial covenants under its 
debt agreements.  The Company was granted a temporary modification to 
the loan covenant agreements by its lenders in the fourth quarter of 
1995 since the restructuring charge incurred in 1995 caused the fixed 
charge coverage ratio to fall below 200%, the minimum level of 
compliance under the agreements.  The Company's financial performance 
during the third quarter of 1996 was not sufficient to meet the 
minimum level of compliance pursuant to the 1995 modification.  The 
Company's lenders waived compliance with the fixed charge coverage 
ratio for the third quarter.  The Company and its lenders have
held substantive discussions and have agreed in principle to 
modifying the loan agreements to grant a modification to the fixed 
charge coverage for the fourth quarter of 1996 and the first three 
quarters of 1997.  Under the proposed agreement, the Company will not 
pay a fee or penalty for this modification.  As of the date of submission 
of this report, a final modification agreement has not been signed.

The Company paid a regular dividend of $0.12 per share per quarter 
to its Common shareholders during the first three quarters of 1996, 
resulting in dividends paid of $4.0 million for 1996.  The Company's 
Board of Directors announced the suspension of regular dividends on 
October 24, 1996 due to the acceleration of restructuring expense 
associated with the potential impact, if a decision is made to sell 
or otherwise dispose of its rigid plastics operation.  The Company 
intends to resume paying dividends, possibly in 1997, once operating
performance warrants such resumption.

The Company also announced it is exploring the possible sale of the
Los Angeles rigid plastics operation.  This facility manufactures
thermoformed and injection molded plastic containers primarily for 
the cultured dairy industry on the West Coast.  The Company may 
take up to a $4.0 million charge to earnings in the fourth quarter
if this operation is sold.  A final decision will be made by the 
Board of Directors during the fourth quarter.












                 PART  II  -  OTHER INFORMATION



Item 1.     Legal Proceeding

               None


Item 2.)   Changes in Securities

              None


Item 3.)   Defaults Upon Senior Securities
   
             The Company must comply with various financial covenants 
           under its debt agreements.  The Company was granted a temporary 
           modification to these agreements by its lenders in the fourth 
           quarter of 1995 since the restructuring charge incurred in 1995 
           caused the fixed charge coverage ratio to fall below 200%, the 
           minimum level of compliance under the agreements.  The Company's 
           financial performance during the third quarter of 1996 was not 
           sufficient to meet the minimum level of compliance pursuant to 
           the 1995 modification.  The Company's lenders waived compliance 
           with the fixed charge coverage ratio for the third quarter.  
           The Company and its lenders have held substantive discussions 
           and have agreed in principle to modifying the loan agreements 
           to grant a modification to the fixed charge coverage for the 
           fourth quarter of 1996 and the first three quarters of 1997.  
           Under the proposed agreement, the Company will not pay a fee 
           or penalty for this modification.  As of the date of submission 
           of this report, a final agreement has not been signed.


Item 4.)   Submission of Matters to a Vote of Securities Holders

               None


Item 5.)   Other Materially Important Events

             On October 24, 1996, the Company announced the closing of
           its Charlotte and Raleigh, North Carolina production 
           facilities.  Equipment and production from the Charlotte 
           flexible packaging facility will be moved to the Company's 
           Akron, Ohio and San Leandro, California flexible packaging
           facilities.  Equipment from the Company's Styrotech machine 
           manufacturing facility in Raleigh will be moved to DeSoto,
           Kansas and will be combined with the existing machine 
           manufacturing operations currently located in DeSoto.  These 
           moves are expected to increase restructuring expense in the
           fourth quarter to $2.3 million and will complete the 
           restructuring plan announced in late 1995.  Both moves, 
           which will be substantially complete in the fourth quarter,
           will result in a net reduction of approximately 120 positions.

              The Company also announced it is exploring the possible 
           sale of the Los Angeles rigid plastics operation.  This 
           facility manufactures thermoformed and injection molded 
           plastic containers primarily for the cultured dairy industry
           on the West Coast.  The Company may take up to a $4.0 million 
           charge to earnings in the fourth quarter if this operation
           is sold.  A final decision will be made by the Board of
           Directors during the fourth quarter.



 

Item 6.)   Exhibits and Reports on Form 8-K

               Exhibit 27    Financial Data Schedule






                     SALES OF UNREGISTERED SECURITIES




                                None

























                             SIGNATURES


   Pursuant to the requirements of the Securities Exchange Act of 1934, 
the registrant has duly caused this report to be signed on its behalf 
by the undersigned thereunto duly authorized.


     




Date:     November 11, 1996                  /s/ Charles F. Marcy  
                                          By: Charles F. Marcy
                                              President & CEO




Date:     November 11, 1996                   /s/ John T. Carper
                                          By: John T. Carper
                                              Senior Vice President 
                                                Finance & CFO
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SECURITIES AND EXCHANGE COMMISSION

                           Washington, D.C.  20549
                               _____________

                                 FORM 10-Q

                Quarterly Report Under Section 13 or 15(d)
                  of The Securities Exchange Act of 1934

For Quarter Ended September 30, 1996 Commission file number 0-14825

                              SEALRIGHT CO., INC.
           (Exact name of registrant as specified in its charter)

          Delaware                              16-0876812
  (State or other jurisdiction of             (IRS Employer
   incorporation or organization)           Identification No.)

  9201 Packaging Drive, DeSoto, Kansas                66018
   (Address of principal executive offices)         (Zip Code)

Registrant's telephone number, including area code  913-583-3025

   7101 College Boulevard, Overland Park, Kansas  66210-1891     
Former name, former address and former fiscal year, if changed since
last report.

Indicate by check mark whether the registrant (1) has filed all 
reports required to be filed by Section 13 or 15(d) of the Securities 
Exchange Act of 1934 during the preceding 12 months (or for such 
shorter period that the registrant was required to file such reports), 
and (2) has been subject to such filing requirements for the past 90 days.

(1) Yes     X     No             (2)  Yes    X     No        

As of September 30, 1996, Sealright Co., Inc. had 11,071,991 shares of 
Common Stock outstanding.  The market value of stock held by non-
affiliates is approximately $71,943,000.

             SEALRIGHT CO., INC. AND SUBSIDIARIES
    
                          FORM 10-Q

                       November 1, 1996

                 PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

                      INTRODUCTORY COMMENTS
The Consolidated Financial Statements included herein have been 
prepared by Management, without audit, pursuant to the rules and 
regulations of the Securities and Exchange Commission.  Certain 
information and footnote disclosures normally included in financial 
statements prepared in accordance with generally accepted accounting 
principles have been condensed or omitted pursuant to such rules and 
regulations, although Management believes that the disclosures are 
adequate to enable a reasonable understanding of the information presented.
It is suggested that these Consolidated Financial Statements be read 
in conjunction with the financial statements and the notes thereto 
included in the Company's Annual Report on Form 10K, for the year 
ended December 31, 1995.

Except for historical information contained herein, the matters set 
forth in this report or in oral statements made by officers of the 
Company are forward looking statements that involve certain risks 
and uncertainties that could cause actual results to differ materially 
from those in the forward looking statements.  The Company's expectations 
respecting future revenues and profits assume, among other things, 
reasonable continued growth in the general economy which affects demand 
for the Company's products, reasonable stability in raw material pricing, 
changes in which affect customer purchasing decisions as well as the 
Company's revenues and margins, and successful execution of the Company's 
previously announced restructuring plan.

The costs and benefits of the Company's restructuring and facility 
consolidation plan may vary from the Company's original expectations due 
to various factors such as:  the extent of management's ability to control 
costs, inefficiencies, overheads and operational issues during the 
transition period; sales prices realized upon future disposal of redundant 
assets, particularly real property which is subject to future supply and 
demand conditions in various real estate markets; higher or lower than 
anticipated rates of relocation or resignation of employees who otherwise 
would receive termination payments and difficulties inherent in forecasting 
results of an operating mode different from that which exists at the time 
the forecast is made.  Investors are also advised to consider other risks 
and uncertainties that may be discussed in documents filed by the Company 
with the Securities and Exchange Commission.

                    SEALRIGHT CO., INC. AND SUBSIDIARIES
                       CONSOLIDATED INCOME STATEMENTS
               FOR THE PERIODS ENDED September 30, 1996 and 1995
                    (In Thousands Except Per Share Data)
                                  (Unaudited)

                                  Three Months        Nine Months
                            Ended September 30  Ended September 30
                                1996      1995       1996     1995  

Net Sales                      $68,419   $76,151   $209,214 $230,824
Cost of Sales                   55,542    63,237    173,790  187,109      
    Gross Profit                12,877    12,914     35,424   43,715 

Selling, Gen. & Admin. Exp.      7,775     9,561     25,085   27,043  
Other Expense                      270       365        753    1,148

Restructuring Expense              815       --       3,264      -- 

Operating Income                 4,017     2,988      6,322   15,524

Interest Expense                 1,318     1,243      4,050    3,743  

Income Before Income Taxes       2,699     1,745      2,272    11,781

Provision for Inc. Taxes           975       698        814     4,695
 
NET INCOME                     $ 1,724   $ 1,047   $  1,458  $  7,086
 
NET INCOME PER SHARE           $  0.15   $  0.09   $   0.13  $   0.64

AVERAGE NUMBER OF COMMON 
  AND COMMON EQUIVALENT 
  SHARES OUTSTANDING            11,072    11,072     11,072     11,095         

                     SEALRIGHT CO., INC. AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
                    September 30, 1996 and December 31, 1995
                                (In Thousands)
                                  (Unaudited)

                                     September 30, 1996   December 31, 1995
                                   ASSETS
Current Assets
Cash                                       $      8         $  6,017
Accounts Receivable                          28,596           22,591
Inventories (Note 3)                         43,844           39,848
Other Current Assets                          3,448            2,639
       Total Current Assets                  75,896           71,095
Property, Plant & Equipment                 249,804          240,065
Less:  Accumulated Depreciation             108,364           97,762  
Property, Plant and Equipment, Net          141,440          142,303

Intangibles, Net                             11,354           12,115
Other Assets                                  2,215            2,584
TOTAL ASSETS                               $230,905         $228,097

                     LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Current Maturities of Long-Term Debt      $   6,200         $  6,200
Accounts Payable                             14,905           12,874
Accrued Vacation                              3,103            3,253
Accrued Workers' Compensation Reserve         2,354            2,675
Restructuring Liability                       1,192            3,259
Accrued Liabilities                           6,578            1,989
   Total Current Liabilities                 34,332           30,250
Long-Term Debt                               81,350           77,400
Deferred Income Taxes                        12,061           14,168
Post-Retirement Benefits                      2,381            2,241
Pension Liability                               917              917
Restructuring Liability                         375            1,105
TOTAL LIABILITIES                           131,416          126,081

Stockholders' Equity
Common Stock, Par Value $.10
  Authorized 20,000,000 shares;
  issued and outstanding 11,071,991
  as of September 30, 1996 and
     December 31, 1995, respectively          1,107            1,107
Paid-In Capital                              14,911           14,911
Retained Earnings                            83,471           85,998
   Total Stockholders' Equity                99,489          102,016

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $230,905         $228,097

                   SEALRIGHT CO., INC. AND SUBSIDIARIES
                    CONSOLIDATED STATEMENTS OF CASH FLOWS
     FOR THE NINE MONTHS ENDED September 30, 1996 and September 30, 1995
                              (In Thousands)
                                (Unaudited)

                                                    1996         1995

Cash Flows from Operating Activities:
Net Income                                       $  1,458     $  7,086     
Adjustments to Reconcile Net Income to Net
  Cash Provided by Operating Activities:
     Depreciation & Amortization                   15,007       14,697
     Deferred Tax Provision                         1,530        3,127
     Changes in Assets and Liabilities:
       Accounts Receivable, Net                    (6,680)      (4,288)
       Inventories                                 (3,996)      (3,202)
       Accounts Payable                             2,623        2,276
       Other                                       (2,448)      (1,420)
          Total Adjustments                      $  6,036     $ 11,190     
Net Cash Provided By Operating Activities        $  7,494     $ 18,276     
Cash Flows from Investing Activities:
  Capital Expenditures                           $(13,603)    $(16,814)
  Proceeds from Disposal of Equipment                 106          157
Net Cash Used in 
  Investing Activities                           $(13,497)    $(16,657)    

Cash Flows from Financing Activities:
  Net Borrowings Under Revolving 
    Credit Agreement                             $  8,000     $  7,000          
  Proceeds from Common Stock Issued                   --           165
  Principal Payments of Long-Term Debt             (4,017)      (5,151)
  Dividends Paid                                   (3,989)      (3,982)    
Net Cash Used in Financing Activities            $     (6)    $ (1,968)    

Net Decrease in Cash                             $ (6,009)    $   (349) 
Cash, Beginning of Year                             6,017        1,057

Cash, End of Nine Months                         $      8     $    708

                    SEALRIGHT CO., INC. AND SUBSIDIARIES

                                   10-Q

                             SEPTEMBER 30, 1996

                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - FINANCIAL STATEMENT PRESENTATION
In the opinion of Management, the accompanying unaudited consolidated 
financial statements contain normal interim adjustments necessary to 
present fairly the financial position of Sealright Co., Inc. and 
Subsidiaries as of September 30, 1996 and December 31, 1995, and 
the results of their operations for the periods ended September 30, 
1996 and 1995.

NOTE 2 - ACCOUNTING PRINCIPLES AND POLICIES
The accompanying financial statements have been prepared consistent 
with the accounting principles and policies described more fully 
in Note 1 of the Company's Annual Report for the year ended 
December 31, 1995.

NOTE 3 - INVENTORIES
Inventories at September 30, 1996 and December 31, 1995, were:

                                                 1996    1995
                                                (In Thousands)
Inventories Carried on LIFO Basis
  Raw Materials                                 $16,154 $13,395
  Work-In-Process                                 5,175   9,163
  Finished Goods                                 18,126  12,714
                                                $39,455 $35,272

  LIFO Reserve                                   (1,470) (1,466)
Inventories Carried on LIFO Basis               $37,985 $33,806
Inventories Carried on Average or FIFO Basis      5,859   6,042
                                                $43,844 $39,848

Because the inventory determination under the LIFO method can 
only be made at the end of each fiscal year based on the 
inventory levels and costs at that time, interim LIFO 
determinations, including those at September 30, 1996, must 
necessarily be based on management's estimate of expected year-end 
inventory levels and costs.  Since estimates of future inventory 
levels and prices are subject to many factors beyond the control 
of management, interim financial results are subject to final 
year-end LIFO inventory amounts.  Accordingly, inventory components 
reported for the period ending September 30, 1996, are estimates 
based on management's knowledge of the Company's production cycle, 
the costs associated with this cycle and the sales and purchasing 
volume of the Company.

NOTE 4 - STATEMENTS OF CASH FLOWS
     Supplemental cash flow information for the nine months ended 
     September 30, 1996 and 1995 is (in thousands):

                                                  1996    1995
     Interest Paid (Net of Amount Capitalized)  $ 4,081 $ 3,880
     Income Taxes Paid                              317   1,530

ITEM 2.

             MANAGEMENT'S DISCUSSION AND ANALYSIS OF OPERATIONS
                           AND FINANCIAL CONDITION

Results of Operations

Year-to-date net sales were $209.2 million, down $21.6 million or 
9.4 percent, from 1995.  Net sales for the third quarter of 1996 
were $68.4 million, a decrease of 10.2 percent from the same quarter 
of 1995.  For the quarter, sales of rigid paperboard products were 
down 10.8 percent while sales of flexible packaging products were 
down 9.2 percent from the same quarter of 1995.  Sales at the Company's 
subsidiary in Australia were up more than 200 percent ($630) thousand from 
last year reflecting the Company's expanding international presence.  The 
revenue decline for both the year and the quarter is attributed to
three factors.  First, cool, wet weather coupled with rising raw material 
costs for the dairy industry, primarily butterfat, reduced demand for the 
Company's frozen dessert packaging by $3.4 million for the quarter and
9.5 million year-to-date from the same period last year.  Secondly, the 
Company had $8.0 million and $2.8 million of revenue year-to-date and 
the quarter ended September 30, 1995, respectively, from customers 
that were lost in late 1995 and early 1996.  Finally, the Company lost 
several accounts due to unanticipated factors.

Gross profit year-to-date was $35.4 million compared to $43.7 million 
a year ago.  Gross profit for the quarter was $12.9 million, or 18.8 
percent of net sales.  During the third quarter of 1995, the Company's 
gross margin was 17.0 percent.  The increase in gross margin, despite 
the $7.7 million decline in revenue, reflects the Company realizing 
the expected efficiency benefits from its restructuring plan.  The 
inefficiencies sustained during the first and second quarter as a 
result of moving the Company's DeSoto, Kansas rigid paperboard 
operations to Fulton, New York and Los Angeles, California have 
diminished.  Both facilities' performance has improved.  The Company's 
gross margin in the third quarter improved from the first and second 
quarters of 1996 in both rigid and flexible packaging operations.  
However, the Company continued to suffer from losses at its Los Angeles 
rigid plastics operation due to significant inefficiencies encountered 
during the conversion to new thermoforming equipment.  The operating 
loss for the third quarter was $800 thousand and the loss year-to-date
was $2.3 million.

Selling, General and Administrative expenses year-to-date are down 
$2.0 million, or 7.2 percent, from 1995.  SG&A expenses for the 
quarter are down $1.7 million, or 18.7 percent, from the same period 
last year.  These reductions are primarily due to staffing reductions 
as part of the Company's restructuring plan coupled with continued cost 
cutting initiatives.  The Company has eliminated approximately 70 
salaried positions since last September. 

The Company has been incurring restructuring expenses during the year 
as a result of moving equipment and personnel involved with the plant 
consolidation plan announced in late 1995.  Additionally, other costs 
associated with the restructuring such as employee recruiting and 
management reorganization are classified in this category.  Restructuring 
expenses year-to-date have been $3.3 million, and $0.8 million for the 
third quarter.  Restructuring expense during the quarter reflects costs 
associated with moving the Company's machine manufacturing operations, 
research and development center and Corporate Office to the DeSoto 
facility.  Restructuring expense is expected to be approximately $2.3 
million during the fourth quarter as the Company consolidates its 
Charlotte and Raleigh, North Carolina facilities. 

Interest expense year-to-date was $4.0 million, or 8 percent higher 
than last year, reflecting a higher level of debt coupled with reduced 
interest capitalization.  Capital spending is 19 percent lower than 
last year reducing the amount of associated interest expense 
capitalization.  Interest expense for the quarter is 6 percent higher 
than last year as a result of the same factors.

Liquidity and Capital Resources

  Net cash provided by operating activities for the nine month 
period ended September 30, 1996, was $7.5 million compared to 
$18.3 million for the same period in 1995.  The primary cause of the 
reduction year over year has been the reduction in the Company's level 
of net income.  Earnings are down primarily due to reduced net sales, 
losses at the Company's rigid plastics facility and additional expenses 
associated with the ongoing restructuring.  Accounts receivable and 
inventories reflect higher dollar and percentage increases from the 
beginning of 1996 versus 1995 due to aggressive management of these two 
asset classes in the fourth quarter of last year, resulting in low 
year-end levels of receivables and inventory.  Capital expenditures 
year-to-date were $13.6 million, which is 19 percent lower than the 
same period last year.  Capital spending has been directed at 
modifications to facilities to accommodate equipment consolidation, 
cost savings initiatives and the Company's new management information 
system.

At September 30, 1996, the Company had borrowed $8.0 million against its 
$30 million bank line of credit at an average interest rate of 5.95%.  
The remaining $22 million of available credit is significantly more 
than the Company's anticipated needs for working capital and investment 
spending for the balance of the year.

The Company must comply with various financial covenants under its 
debt agreements.  The Company was granted a temporary modification to 
the loan covenant agreements by its lenders in the fourth quarter of 
1995 since the restructuring charge incurred in 1995 caused the fixed 
charge coverage ratio to fall below 200%, the minimum level of 
compliance under the agreements.  The Company's financial performance 
during the third quarter of 1996 was not sufficient to meet the 
minimum level of compliance pursuant to the 1995 modification.  The 
Company's lenders waived compliance with the fixed charge coverage 
ratio for the third quarter.  The Company and its lenders have
held substantive discussions and have agreed in principle to 
modifying the loan agreements to grant a modification to the fixed 
charge coverage for the fourth quarter of 1996 and the first three 
quarters of 1997.  Under the proposed agreement, the Company will not 
pay a fee or penalty for this modification.  As of the date of submission 
of this report, a final modification agreement has not been signed.

The Company paid a regular dividend of $0.12 per share per quarter 
to its Common shareholders during the first three quarters of 1996, 
resulting in dividends paid of $4.0 million for 1996.  The Company's 
Board of Directors announced the suspension of regular dividends on 
October 24, 1996 due to the acceleration of restructuring expense 
associated with the potential impact, if a decision is made to sell 
or otherwise dispose of its rigid plastics operation.  The Company 
intends to resume paying dividends, possibly in 1997, once operating
performance warrants such resumption.

The Company also announced it is exploring the possible sale of the
Los Angeles rigid plastics operation.  This facility manufactures
thermoformed and injection molded plastic containers primarily for 
the cultured dairy industry on the West Coast.  The Company may 
take up to a $4.0 million charge to earnings in the fourth quarter
if this operation is sold.  A final decision will be made by the 
Board of Directors during the fourth quarter.

                 PART  II  -  OTHER INFORMATION

Item 1.     Legal Proceeding

               None

Item 2.)   Changes in Securities

              None

Item 3.)   Defaults Upon Senior Securities
   
             The Company must comply with various financial covenants 
           under its debt agreements.  The Company was granted a temporary 
           modification to these agreements by its lenders in the fourth 
           quarter of 1995 since the restructuring charge incurred in 1995 
           caused the fixed charge coverage ratio to fall below 200%, the 
           minimum level of compliance under the agreements.  The Company's 
           financial performance during the third quarter of 1996 was not 
           sufficient to meet the minimum level of compliance pursuant to 
           the 1995 modification.  The Company's lenders waived compliance 
           with the fixed charge coverage ratio for the third quarter.  
           The Company and its lenders have held substantive discussions 
           and have agreed in principle to modifying the loan agreements 
           to grant a modification to the fixed charge coverage for the 
           fourth quarter of 1996 and the first three quarters of 1997.  
           Under the proposed agreement, the Company will not pay a fee 
           or penalty for this modification.  As of the date of submission 
           of this report, a final agreement has not been signed.

Item 4.)   Submission of Matters to a Vote of Securities Holders

               None

Item 5.)   Other Materially Important Events

             On October 24, 1996, the Company announced the closing of
           its Charlotte and Raleigh, North Carolina production 
           facilities.  Equipment and production from the Charlotte 
           flexible packaging facility will be moved to the Company's 
           Akron, Ohio and San Leandro, California flexible packaging
           facilities.  Equipment from the Company's Styrotech machine 
           manufacturing facility in Raleigh will be moved to DeSoto,
           Kansas and will be combined with the existing machine 
           manufacturing operations currently located in DeSoto.  These 
           moves are expected to increase restructuring expense in the
           fourth quarter to $2.3 million and will complete the 
           restructuring plan announced in late 1995.  Both moves, 
           which will be substantially complete in the fourth quarter,
           will result in a net reduction of approximately 120 positions.

              The Company also announced it is exploring the possible 
           sale of the Los Angeles rigid plastics operation.  This 
           facility manufactures thermoformed and injection molded 
           plastic containers primarily for the cultured dairy industry
           on the West Coast.  The Company may take up to a $4.0 million 
           charge to earnings in the fourth quarter if this operation
           is sold.  A final decision will be made by the Board of
           Directors during the fourth quarter.

 

Item 6.)   Exhibits and Reports on Form 8-K

               Exhibit 27    Financial Data Schedule

                     SALES OF UNREGISTERED SECURITIES

                                None

                             SIGNATURES

   Pursuant to the requirements of the Securities Exchange Act of 1934, 
the registrant has duly caused this report to be signed on its behalf 
by the undersigned thereunto duly authorized.

     

Date:     November 11, 1996                  /s/ Charles F. Marcy  
                                          By: Charles F. Marcy
                                              President & CEO

Date:     November 11, 1996                   /s/ John T. Carper
                                          By: John T. Carper
                                              Senior Vice President 
                                                Finance & CFO