JOIN USGlobal art market shrank 22% in pandemic year: Study
Global sales of art and antiques in 2020 were estimated to have declined by 22 per cent from the previous year, according to the latest annual Art Basel and UBS Art Market report, published Tuesday.
The 359-page report, the most comprehensive analysis of the coronavirus pandemic’s effect on the international art trade to date, found that combined dealer and auction house sales totaled $50.1 billion, their lowest level since the financial crisis of 2009.
With art fairs postponed and galleries shuttered, dealer sales declined an aggregate 20 per cent, to $29.3 billion, in 2020, while public auctions, many of which were conducted in online-only formats, were down 30 per cent, to $17.6 billion. One brighter spot was in private transactions at auction houses, which were up 36 per cent, to $3.2 billion, according to the report.
“It could have been a lot worse than it was,” said economist Clare McAndrew, the author of the report, which was compiled from publicly available data from auction houses and estimates based on survey responses from 1,715 art and antiques dealers.
“The second half of the year was better for a lot of people,” McAndrew said in an interview. “There was a huge shift to online sales, and some galleries in Asia came back really strongly.”
The report noted that the number of billionaires rose 7 per cent in 2020, with the wealth they held growing 32 per cent over the year.
“From the buying side, there were a lot of people with a lot of time and cash, and there weren’t that many outlets for their spending,” McAndrew said.
The report found that online sales of art and antiques reached an estimated high of $12.4 billion in 2020, double the previous year, accounting for 25 per cent of the market’s value.
The tectonic plates of the art trade also shifted during the 2020 pandemic, according to the report. The United States remained the largest market overall, with $21.3 billion of combined auction and dealer sales, followed by China, which the report defines as including mainland China, Hong Kong and Taiwan. Being able to lift coronavirus-related restrictions earlier than Western economies helped China back into second position, with $10 billion of sales, overtaking Britain, at $9.9 billion. China also became the world’s biggest center for auction sales, with $6.3 billion.
The report, co-commissioned by Art Basel, one of the world’s biggest art fair organizers, said that 61 per cent of the 365 fairs planned for 2020 were canceled but that the majority of those scratched events had offered either online viewing rooms or some other digital alternative. As a result, dealers reported making 22 per cent of their annual sales from fairs, including the online viewing rooms, about half the percentage that they were taking from fairs in 2019.
Thaddaeus Ropac, a dealer in contemporary art with galleries in London, Paris and Salzburg, Austria, said, “We don’t sell major works online at art fairs.”
For the online viewing rooms, he said, “We put on works by a few younger artists for people we don’t know.”
But during the pandemic, Ropac said that he had noticed a new willingness among his established clients to buy high-value works that they hadn’t seen in person. Next month, Ropac plans to offer a series of new large-scale works by German painter Georg Baselitz in his Salzburg gallery, each priced at about 1.2 million euros, or $1.4 million.
“Ninety percent of these will sell to people who haven’t seen the paintings,” Ropac said. He estimated that his dealership’s sales were down by about 25 per cent last year, but he has managed to maintain a staff of more than 100 employees.
Although the Art Basel and UBS report contains little specific data on gallery closures, it estimated that employment in the art market had shrunk by 5 per cent in 2020, including “significant declines” at some of the top-end auction houses.
With many countries experiencing renewed surges of coronavirus infections, McAndrew, the author of the report, said she was not expecting the art trade to return to anything resembling normalcy soon.
“I see this as another transitional year. Nobody expected this to drag on for so long,” she said, pointing out that many government-backed measures to support employers would expire this year. “I suspect we may see more businesses in trouble.”
But talking of transition, what did she make of the market’s latest mania, for nonfungible tokens, or NFTs, which culminated last week in a JPG file by digital artist Beeple selling for a record $69.3 million at Christie’s?
According to McAndrew, that sale would be included in the 2021 Art Basel and UBS report, but her current methodology did not include NFT-specific selling platforms such as Nifty Gateway and Open Sea, where other Beeple works have sold for as much as $6.6 million.
“NFTs interest me, going forward,” McAndrew said. “Is my $50 billion shrinking a bit? And is the activity outside going to be even greater?”