Abstract: An apparatus for manufacturing packing material from a web material includes a folding member that folds the web material into a folded web, a longitudinal sealing assembly for sealing the longitudinal ends of the folded web material forming a continuous tube, and a lateral sealing assembly including a pair of lateral sealing rollers that effect staged lateral sealing of the continuous tube of the web material. Pressurized air is outlet after the longitudinal seal is formed and prior to forming the lateral seal. With this arrangement, air-filled pockets suitable for packing material can be readily formed for immediate use. The arrangement is compact in size and capable of producing packing material on demand and at a sufficient rate to satisfy immediate packing material needs.