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China’s $8.3 Billion Art Market Overtakes U.K., Report Says

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Bodhisattva
An early Yuan-dynasty Chinese lacquered bronze of the cross-legged Bodhisattva Avalokitesvara. It will be priced at $8 million at the booth of the London- and New York-based dealers Littleton & Hennessy at the Tefaf art and antiques fair in Maastricht, previewing on March 17. Source: Littleton & Hennessy via Bloomberg

March 14 (Bloomberg) -- China has overtaken the U.K. to become the world’s second-largest art market after the U.S., according to research published today.

Auction and gallery sales in China totaled the equivalent of almost 6 billion euros ($8.3 billion) in 2010, giving the country a 23 percent share of the global market, said the British Art Market Federation. The U.S. continues to dominate, with 34 percent. The U.K. remains Europe’s biggest auction center, with 22 percent of international sales.

The full survey is scheduled to be released later today by the Netherlands-based European Fine Art Foundation three days before the world’s largest art and antiques fair, Tefaf, previews in the Dutch city of Maastricht.

Since 2006, the U.K.’s share of the global art market has fallen to 22 percent from 27 percent, the BAMF said in an e-mailed statement. Europe’s share has fallen even more sharply.

“This study makes alarming reading for us,” said Anthony Browne, BAMF’s chairman, in the statement.

He warns that sales are being damaged by a European Union levy that entitles living artists to a portion of the resale value of their work. “The EU alone applies this levy,” he said. “It does not exist in China, the U.S. or Switzerland, our main global competitors.”

Levy Extension

The levy was introduced in the U.K. in 2006 under a European Union directive. The BAMF was set up in 1996 to represent the interests of Britain’s auction houses and art trade associations. It’s campaigning against European Commission plans to extend the levy in the U.K. in 2012 to the work of deceased artists 70 years after their deaths.

The European Fine Art Foundation’s study “The International Art Market in 2010: Crisis and Recovery” comes as more than 260 dealers prepare for Tefaf. The event will offer 30,000 works with a total value of more than 1 billion euros, said insurers.

International sales of art and antiques totaled 43 billion euros in 2010, a 52 percent increase on 2009, when the market suffered from economic worries and sluggish growth, the Tefaf report said.

The recovery was strongest in the U.S. and China. Art sales in the latter have nearly doubled in value since 2009, according to the report, prepared by Clare McAndrew, founder of the Dublin-based consulting company Arts Economics. The headline figures combine transactions made by both dealers and auction houses.

Modern and contemporary art represented 58 percent of the 2010 sales with pre-1950 pieces accounting for six times the value of more recent works. The auction sector has become dependent on individual lots selling for more than 50,000 euros.

Results such as the record $106.5 million paid for Picasso’s 1932 “Nude, Green Leaves and Bust” accounted for 81 percent of the market by value, though only 5 percent by volume.

“Buyers were seeking higher quality or well-established works, whereas sales in the middle of the market were recovering more slowly,” the report said.

The Tefaf preview for VIPs is on Thursday March 17.

(Scott Reyburn writes about the art market for Muse, the arts and culture section of Bloomberg News. Opinions expressed are his own.)

To contact the writer on the story: Scott Reyburn in London at sreyburn@hotmail.com.

To contact the editor responsible for this story: Mark Beech at mbeech@bloomberg.net.

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