The Current State Of The Art Market


The European Fine Art Foundation, better known as TEFAF, has recently released its art market report – the prime measuring tool to measure the global art market’s health. This year’s edition was spearheaded by Professor Rachel A. J. Pownall and it confirms initial suspicions of a drop in the international art sales, along with a number of positive highlights for specific sub-sectors.

Professor Pownall holds the TEFAF Chair in Art Markets at the School of Business Economics of Maastricht University, and the Van Gogh Chair on Art Finance and Museum Management at the TIAS School for Business and Society.

According to the report, which was written in partnership with the Maastricht Centre for Arts and Culture, Conservation and Heritage (MACCH, Maastricht University), Europe is still the largest global exporter of art and antiques, while UK trade has decreased and imports to China are also showing signs of slowing down.

current state of the art market

However, despite the global and political uncertainty caused by dangerous shifts like Brexit and the US presidential elections, the art market continues to present itself as sturdy and resilient.

As far as key figures are concerned, sales in the global art market have his $45 billion in 2016, up by almost 1.7% from the previous year. The TEFAF report has taken a slightly different approach this year, with a more specific definition of art dealers and art galleries – in doing so, the overall industry estimates now seem smaller than in previous reports, but much more accurate and representative of the global art and antiques market.

current state of the art market

It is worth noting at this point that Europe continues to be the most significant continent, with over $25 billion worth of sales. The Americas come second with $14.5 billion, followed by Asia with approximately $10 billion. In certain markets, the US covered 29.5% of all sales, while the UK ranked in 24% and China held its ground at 18%.

The dramatic development came in the form of a drop in the value of global auction sales – a plunge of 18.8% to $16.9 billion in 2016, from $20.8 billion in 2015. The total number of items sold at auctions has also dropped by 21.5%. The US lost even more in this regard, as its auctions sales fell by a whopping 41%. Europe has also lost 13% in this sector, from $6 billion in 2015 to $5.22 billion in 2016. Nevertheless, Asia has maintained its stability and now holds the largest share of the global auction market at 40.5%, with China in the lead.

current state of the art market

The move to private sales is the main reason for this negative shift, as dealer revenues increased by 20% to 25% during the same period. Private sales now cover approximately 70% of global sales. It does make sense, if we look at it from a collector’s perspective – the dealer market provides both privacy and anonymity, especially in transactions of high-value works. The phenomenon has also been recognised by auction houses, as they have begun facilitating a larger number of private sales.

This has greatly benefitted independent dealers, on top of changing the way auction houses do business – proven by how strong private sales through dealers and galleries have been in 2016, with retail sales values up by 24%. Europe alone has grown by 20% over the year, already home to 54% of the worldwide dealer community.

current state of the art market

Perhaps the most interesting thing to note is that dealers have started to change the way they do business. The internet (and social media) have grown significantly as a sales platform. It has had an impact on how dealers market their expertise and the way in which clients access specific information. The lower end of the market has benefitted the most, with more than 75% of sales being under $5k concluded via websites.

Another notable indicator of how the global art market is developing can be found in possible changes in artistic taste. Collectors seem to have lost their appeal for “auction classics” such as Andy Warhol, Pablo Picasso, Modigliani, Francis Bacon and Cy Twombly, all of their works having seen a serious drop in sales performance.

Continue reading the full story: Coshamie



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