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Beijing: market transformation and Art Beijing’s strategy

[16 Apr 2019]

In less than ten years, China has imposed itself on the global Art Market and now represents the planet’s second largest marketplace. In 2018, China generated $4.5 billion in Fine Art auction turnover behind the United States’ $5.9 billion. But whereas the US total increased 18% last year, China’s total shrank by 12%, suggesting that the Eastern Giant is continuing the restructuring process begun in 2015 as the country’s auction operators focus, among other initiatives, on reducing their unsold rates. Still high, China’s nationwide unsold rate fell from 64% in 2017 to 54% in 2018.

The slowdown in the Chinese Art Market has not, however, prevented it from generating a number of very impressive results, which prove that buyers have not lost confidence. Above all, these strong results show that major collectors are increasingly active in the market.

One such result was $16.4 million at Poly International for an oil painting by WU Guanzhong (1919-2010) titled Two swallows. The work, which the artist himself considers one of his “most remarkable and most representative” works, was the only oil painting to have fetched over $10 million in mainland China during 2018. The sale took place in Beijing last December. In fact, 2018 proved to be the best year for Oil Painting and Contemporary Chinese Art since the global financial crisis. In total, 7,092 lots classified as Oil Painting and Contemporary Chinese Art were sold during 2018, generating a combined turnover of nearly $1.25 billion. This not only represents a 34% increase vs. 2017 (and the last peak of 2011), but also a 10-year record.

The Chinese market is also expanding geographically with four major poles each contributing to country’s art market: Beijing first (45%), followed by Hong Kong (29%), Shanghai (7%) and Guangzhou (6.7%). This structure has allowed China to marry its internal market with the international market, with both markets being extremely dense and complementary: the Anglo-Saxon giants Christie’s, Sotheby’s and Phillips have managed to set up in Hong Kong, but the Chinese auction houses reign over the mainland. Few Western galleries have settled there (Pace and Continua in Beijing, Perrotin in Shanghai…), while many others are content with one-off events, including participation in fair

A spirit of openness

Chinese auction houses are renewing their offer, paying particular attention to the academic value of a number of artists they consider worth re-discovering. Along with the country’s collectors, auctioneers are exploring other masters from the same period as already highly sought-after superstars like Qi Baishi and Zhang Daqian. Meanwhile, the aesthetic preferences of Asian collectors appear to be constantly changing with the emergence of what can only be described as a ‘perfect mix of genres’, a mix that is increasingly specific to the region. In China, artists are combining traditional painting and calligraphy with extremely original approaches that are evolving with the development of new techniques.

The Chinese art market is therefore in full transformation. More demanding, it is above all increasingly open, especially to Western creation. Cultural events confirm this openness: this April Beijing has exhibitions as diverse as solo shows for a Chen Yujun at Tang Contemporary, Qiu Zhijie at the Ullens Center for Contemporary Art (UCCA), Shi Guowei at the Magician Space, Marina Abramović at the Light Society, Richard Tuttle at M Woods and Leila Alaoui at the Continua Gallery, among many other events. Beijing is hosting the best of the Chinese, Western and even Oriental art scenes, exposing the public to ever-more diversified fields of artistic knowledge

Beijing, at the heart of the Chinese Art Market

Beijing is not only China’s political and economic centre, it is also its cultural and artistic epicenter. At the heart of Contemporary creation, the megacity has hundreds of galleries, art centres and museums. Among the most popular sites, the 798 Art District in city’s north-eastern Dashanzi area has earned a worldwide reputation over the last 20 years, first for its enormous artists’ studios, and then for the galleries that gradually set up there. Indeed, the presence of the Ullens Center for Contemporary Art (UCCA), a veritable temple of Contemporary Art, created by collectors Guy and Myriam Ullens, has helped to make this district the epicenter of Contemporary Art in China since it opened in 2007.

Art Beijing…

A year before the UCCA opened, the organisers of the first edition of the Art Beijing Contemporary Art Fair began to set the stage, attracting art fans from all over the world. Year after year, the show has not only kept going… it has grown considerably… and the forthcoming 13th edition to be held at the National Agricultural Exhibition Center (30 April – 3 May 2019) will host 160 exhibitors from 20 different countries. Art Beijing clearly has grand ambitions and this year will have an exhibition area of 30,000 m². Over the years, the fair has also expanded the type of work it offers and now features four distinct sections: one devoted to Contemporary art, one to Classical art, one to Design and another to “Public Art” (works created for outdoor and public spaces). Diversity remains the priority in order to cater for the wide variety of tastes among Beijing’s population and visitors from elsewhere.

Art Beijing is attracting an ever-increasing number of private art enthusiasts looking for a work they can put in their homes. Indeed, the new population of buyers that has emerged in Beijing seems more motivated by a spirit of discovery than by financial speculation. An “art consumer” mentality seems to have replaced an “investor” mentality… Moreover, the fair has adopted a less money-oriented strategy by choosing to focus on local art and local buyers (particularly Beijing’s) rather than on international art and international buyers, as is the case for Art Basel in Hong Kong.

The prices at Art Beijing ranges from roughly $3,000 to about $50,000… sometimes lower for very young artists. This range makes the fair as attractive as possible, with the idea being to get works into circulation without triggering the speculative excesses of the past. And… as the Chinese art market recovers from those excesses, it is hoped that this strategy will help transform it into a bigger, broader and more stable market with a much larger consumer base. It is perhaps precisely because of this differentiated strategy that Art Beijing manages to compete with some of the major international fairs. It’s visitor stats clearly illustrate its success: some 120,000 visitors are again expected this year.

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