The Art Market: year of the new top dog?

Magritte’s ‘Le plagiat’ (1940), which was sold at Christie’s for £5.2m

Is China still number one for art sales? Last year brought the surprise news that the country had overtaken the US and the UK to become the world’s biggest market for art in 2011. The information came from a report compiled by art economist Clare McAndrew for The European Fine Art Fair (Tefaf), which gave China a 30 per cent share of the market in dealer and auction sales for fine and decorative art, pushing the US into second place with 29 per cent. For auction sales alone, China’s global share was a stunning 42 per cent, said McAndrew.

But a lot has changed since then, and a front-page article in The Art Newspaper this month records a dramatic drop in sales at China’s top two auction houses in 2012. Poly Auctions saw sales plummet, from $1.9bn in 2011 to $965m in 2012. China Guardian reported $1.8bn in 2011 but just $820m in 2012.

Other auction houses in China – which now represent half of the world’s top 20 firms, according to the French auction body Conseil des Ventes – have also seen drops, but not as sharp as those of the top two.

McAndrew’s findings for 2012 will remain a closely guarded secret until March, when her new report is launched at Tefaf. All she will say is: “The reshuffle has continued.” The US did better, and the UK did OK, she says: “It was a cooling down year for China. Buying has slowed, and last year marked the end of erratically high growth due in large part to speculation.”

At least 40 art funds have been launched in China during the past few years, but have brought a lot of disappointment, according to McAndrew: “They mainly had a ridiculously short maturity of just three years and were supposed to show growth of 20 per cent in that period,” she says. “People are turning away from these funds and using less formal structures to buy art now.”

While the eye-catching – even if unreliable – figures coming from the Chinese mainland are making western art dealers and auctioneers salivate, the bulk of the Chinese market is still concentrated on traditional Chinese works of art, says McAndrew. “There are probably only about 30 proper collectors of western art in the mainland,” she says.

Asian, Russian and American buyers brought a powerful thrust to the evening sales of Impressionist and modern art held at Sotheby’s and Christie’s this week. Sotheby’s kicked off on Tuesday with a £121m performance, nicely within its £103m-£148m target (pre-sale estimates don’t include premiums; results do). Its top lots, however, were underwhelming, with the Picasso “Femme Assise Près d’une Fenêtre” considered a weak and, worse, unsexy example of the artist’s famed 1932 portraits of Marie-Thérèse Walter. The firm’s Asian chairman Patti Wong bagged it on the telephone for £28.6m against just one other bid, and also successfully nabbed a Morandi. It was a good night for Impressionism – an excellent group of paintings from the estate of the Earl of Jersey brought brisk bidding, as did a widely admired Degas pastel, “Après le bain, femme s’essuyant” (1882-85), which almost doubled its estimate at £7.8m.

Degas’s pastel ‘Après le bain’ (1882-85) sold at Sotheby’s for £7.8m

Christie’s triumphed the following night with a terrific session that scored the firm’s highest total for a February sale, raising £136.4m, just over the pre-sale high of £132m. Russian and Asian buyers were again active. Christie’s specialist Sandra Nedvetskaia, speaking Russian on the phone, trawled in Modigliani’s “Jeanne Hébuterne (au chapeau)” (1919) for £26.9m, and underbid Berthe Morisot’s charming “Après le déjeuner” (1881), which rocketed to almost £7m after at least four other bidders wanted it as well. The winner, Christie’s New York-based David Kleiweg de Zwaan had a busy evening, with the same unidentified client also snapping up a Picasso. Wielding another paddle, Kleiweg de Zwaan also scooped two Magrittes, a Tanguy and a Dalí in the Surrealist section of the sale. Ken Yeh, the firm’s Asian chairman, was also active and, while by no means always successful, crunched Magritte’s “Ceci n’est pas une pomme” (1964).

“What a great sale!” exclaimed private dealer (and former Christie’s specialist) Thomas Seydoux at the end. “The works were fresh to the market and well estimated, there was lots of buzz, there were new buyers – it was magnificent.”

A big shock came last week when Christie's announced that it was closing its primary market gallery, Haunch of Venison; it is believed that about 40 employees from the London and New York branches will lose their jobs. The news was greeted with relief among art dealers, who feared, when the auction house bought the gallery in 2007, that it would mark the final step in a takeover of the market. Christie's would “vertically integrate”, controlling everything from “wet paint” art to major secondary market deals, both through auction and privately, they said.

It hasn’t turned out that way. Despite an improving programme of exhibitions thanks to ex-Tate director Ben Tufnell – notably the just-opened José Parlá show in Haunch of Venison Yard (apparently successfully presold) – the hybrid of an auction house and primary market gallery hasn’t worked out. Haunch was turned down by a number of leading art fairs because of its ownership, and it seems that relations between its secondary sales arm and Christie's own private treaty department were difficult. A major blow was the departure of founders Harry Blain and Graham Southern in 2010, followed by the loss of its popular director Matthew Carey-Williams to White Cube last year.

This is not the first time that an auction house has failed to enter the dealers’ domain. Sotheby’s bought the Andre Emmerich gallery in 1996, hoping to access some of its lucrative estates. But the Albers Foundation quickly pulled out, and in 1998 the auction house threw in the towel and closed the gallery.

Georgina Adam is editor-at-large of The Art Newspaper

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