Translation:The ingredient in the box is the right one.
Quello is also a pronoun that means "the one." This may help: http://www.italianlanguageguide.com/grammar/demonstrative-pronoun.asp
Scroll down to the fourth comment to see the full explanation.
I can attest that "box's" is indeed only for possession and is not a contraction. The only way to say "box is" is by actually typing out "box is". Only certain words can be contracted such as "it+is", "he+is", "she+is", "I+am", "they+are", etc. I can't think of any words that are contractions made for words that are not pronouns except for the word "can't".