Leaf dealers say worldwide consumption of cigarettes continues to grow, though slowly. As that happens, more leaf tobacco is required. Since American blends require better tobacco, this is a plus for leaf dealers in IBD's index. They have operations in countries that grow high-quality tobacco, such as Brazil, Zimbabwe and Malawi. There are still litigation risks.
Economic conditions can worsen and derail growth.
There are also risks of more government rules. Leaf dealers worry about political unrest in some tobacco-growing countries, like Zimbabwe.