In collaboration with artnet, the China Association of Auctioneers releases the Global Chinese Auction Market Report for 2016.
Art Radar looks at some of the key findings presented in this year’s report, which reveals insights into one of the largest art markets in the world today.
With Chinese art still one of the most-collected category of art being collected today, the Chinese Association of Auctioneers (CAA) continues its partnership with artnet to present the fifth edition of the Global Chinese Art Auction Market Report, which studies trends, patterns and insights into the market of Chinese art and antiques in 2016.
It is currently the only report looking into the Chinese art and antiques market that publishes auction results vetted by a third-party organisation, with insider knowledge on the market. The report promises a standard of quality and accuracy, and is aimed at promoting transparency within the Chinese market for art today.
With auction sales of Chinese art and antiques representing more than one-third of the
size of the global art auction market, totaling USD6.7 billion worldwide, the Global Chinese Auction Market Report remains an insightful publication into what may be one of the world’s most important art markets today.
Art Radar highlights some of the key points of this year’s report.
1. With a decline of 5% in worldwide sales, the Chinese art and antiques category collectively enters its third consecutive year of decline in auction performance.
Standing at a total of USD6.7 billion worldwide in 2016, auction sales of Chinese art and antiques see a marked difference from the reported figure of USD7.1 billion for 2015. This follows a larger trend of decline: last year’s Global Chinese Auction Market Report stated a decline of nine percent overall from the previous year.
Despite the decline in overall sales, however, the report reveals that 2016 hits a four-year high in terms of sell-through rate, stating that out of a total of 573,950 Chinese art and antique lots that were offered globally, 300,525 were sold. This brings the sell-through rate to 52 percent, the highest since 2012. Coupled with strong growth in the high-end market, which refers to lots valued above 10 million yuan, this may mean that the market is redoubling its focus on higher-quality lots. In fact, 2016 marked a milestone for the high-end market as well. Sales reached a reported 29 percent overall market share out of the total global auction sale of Chinese art and antiques, a figure that was more than double of that recorded two years ago.
2. The market for auction sales in mainland China recovers, amidst declining sales in Western art markets.
Examining the performance of sales within different locales, the report notes that auction sales of Chinese art and antiques regained its global lead over other markets. With a reported USD4.8 billion in sales, mainland China sees a seven percent recovery following two consecutive years of decline in sales value. This is compared to a reported 24 percent decline in total sales value from markets outside of mainland China.
One highlighted reason for the robust growth in mainland China was a downsize in quantity within mainland China, with auction houses concentrating instead on offering high value lots. The report notes a “tightening supply”, with the number of lots offered for sale dropping to the lowest level in seven years, totaling at 499,260. Coupled with higher sell-through rates and more high-value lots on offer, the report indicates that the market in mainland China is on a trajectory of recovery focused on quality over quantity. With the collecting community continuing to grow in terms of diversity and taste, and a decrease in speculative art-collecting behaviour, the report notes a more selective collector base in mainland China, driving recovery on the back of better-quality work rather than sheer volume of sales.
3. Beijing and Tianjin mark expanding market share, amidst increasing concentration of the market in Asia.
With the market continuing to condense in mainland China, the report notes that both the Beijing and Tianjin regions are taking on larger market shares in both volume and value. Together, Beijing and Tianjin represent 69.9 percent of the market share in mainland China, with the next-largest, the Yangtze River Delta region, representing only approximately 20 percent of overall market share.
The average prices of lots offered in the Beijing and Tianjin region also increased, reaching USD27,764, making it the second-highest worldwide. Asia now represents 78.6 percent of the overall market share for auction sales in Chinese art and antiques, with North America coming in second at 13.2 percent, and Europe representing 8.1 percent of overall global sales. With Asia retaining its traditional position as one of the largest markets in value for this particular collecting category, demand from Chinese buyers has also increased since the second half of 2015, with high net worth individuals investing more in art due to uncertainties in the value of the Chinese yuan.
4. Non-payment remains a chronic problem in mainland China.
However, the report continues to note that the issue of non-payment remains a chronic problem, stating that only slightly more than half of the lots sold in mainland China were actually paid for, out of USD4.8 billion total sales value. With a larger percentage of total sales coming in from higher-value sales, where the practice of paying in installments and delayed payment remains prevalent, higher priced lots sported an even lower percentage of paid-for lots, with only 47 percent of lots having been paid for. This represents a decline in overall payment rate, from 58 percent in 2015 to 51 percent in 2016.
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