China's Slump Casts a Pall on Dealers of Asian Art
On March 10, the exhibition "Ancient Chinese Jade: From the Neolithic to the Han" will open at J.J. Lally & Co. on 57th Street to coincide with New York’s 2016 Asia Week. James Lally, the gallery’s owner, says he has already presold half of the 75 jade objects that make up the show. The pieces range from $5,000 to $500,000, but “the $500,000 pieces are the ones that went first,” he said.
Yet despite that initial success, Lally has a fairly bearish outlook for Asia Week, a 10-day event during which 45 dealers and multiple auction houses throw an Asian-art selling bonanza. “I think we’ve already seen a moderation in activity on the international market for Chinese art,” he said. “The buyers are not as euphoric as they were five years ago.”
That absence of euphoria has a lot to do with the fortunes of mainland Chinese collectors, who in recent years fueled unprecedented growth in the Asian art market. “In the past 25 years I’ve had my gallery, if we had 10 active collectors of what I was selling in New York, we were busy,” said Eric Zetterquist, whose Upper East Side gallery specializes in Asian ceramics. “There are probably 10,000 collectors in the field in China.”
As the Chinese economy continues to slide, many of those buyers have pulled back dramatically—not from the top of the market, which includes many of the jades Lally sold—but from the middle market, where objects sell for around $20,000 to around $90,000.
“In a difficult economy—which we can all admit we’re in—who are the people who are most affected?” asked Lark Mason, the chairman of Asia Week New York. “The people who have fewer resources."
That’s a relative term—these are still small, collectible objects that sell for more than a Mercedes—but the middle-market slump is unmistakable.
“Normally what sells is not selling now,” said Suneet Kapoor, whose Upper East Side Kapoor Galleries specializes in Indian and Himalayan art. He estimated that his business is down 20 percent to 30 percent in the Asian market. “I’ve heard from dealers in mainland China and Hong Kong who’ve mentioned that they haven’t done business in three months,” he said.
This is in stark contrast with the last few years, when the middle market skyrocketed. Now it's coming back to earth.
“Take the example of a porcelain Qianlong period vase that in perfect condition would sell for $150,000 to $250,000,” said Mason. “Now imagine that vase has a serious crack: In a buoyant, frothy market, even with the crack it might make over $100,000; now, in an economy where there are fewer buyers and there’s the sentiment that the market is retrenching, instead of making $100,000, it’s going to sell for half that amount,” he said.
Mason couches this development in positive terms: “I think the other way of saying this is that the speculative aspects of the market have dampened,” he said.
Kapoor, who said most of his gallery’s business is in the middle market, is less sanguine. “It’s affected us across all areas of our specialities—not just Chinese art, but Indian, Himalayan, Gandharan, and Indian works, too,” he said.
Kapoor isn’t simply stepping back to ride things out; he’s actively engaging with Chinese collectors via social media and WeChat and expects a large number of Chinese visitors during Asia Week, when his gallery will open the exhibition "Amrita: Nectar of Immortality," a show featuring Indian miniatures, large Thangkas, and Hindu and Buddhist sculpture, all of which range from $15,000 to more than $300,000.
Chinese buyers are “still a staple,” he said. “You do hope for them to visit, because they still have such buying power.”