News roundup: Salvator Mundi, China and the middle marketJanuary 18, 2018
Key talking points and predictions for the art world, from big buyers to shifting markets
The US$ 450 million price tag on Leonardo Da Vinci’s Salvator Mundi was arguably the biggest single event in the art market in 2017. It set a tone that’s likely to continue into 2018 as we watch prices rise, the middle market shrink and growth shift eastward to booming economies.
Georgina Adam, The Art Newspaper’s Art Market Editor-at-Large, has pinned her predictions for the new year to the sale of Salvator Mundi, speculating that the high price will encourage the growing art-as-investment market and the use of guarantees at auction. She also predicts a revival of interest in the old masters.
According to Georgina, growth at the high-end of the market will continue to depress the middle market. Melanie Gerlis from the Financial Times focusses on the middle market in her editorial, pointing to high-profile gallery closures such as Laura Bartlett and Breeze Little in London, Freymond Guth in Zurich, Adnrea Rosen in New York and Leo Xu in Beijing. Melanie predicts this will lead to new gallery models such as an increase in collaboration and buying online from live auctions. However, she also points to Asia, where art has found its way into high-end shopping malls, attracting the increasing wealth of the growing middle class.
In the U.S., new tax laws are favoring the owners of capital and hitting the middle classes hard. In his New York Times editorial, Scott Reyburn suggests that the tastes of the middle market are shifting from art to luxury items. He points towards recent auctions where wine, watches, jewelry, handbags and cars are replacing art and antiques.
With prices on the rise, art is a popular blue-chip investment; nowhere is this more true than in China. CNBC reporter Huileng Tang says that China, now the world’s third-biggest art market, is the one to watch. The article cites data from Christies, where art buying from Asia went up 40 percent year on year in the first half of 2017 and one fifth of new global buyers were from Asia. A great deal of activity surrounds Chinese art as, Huileng claims, increasingly wealthy citizens look to buy back their heritage. Last year, Chinese ink painter Zhang Daqian generated US$ 31 million more than Pablo Picasso, making the artist top for auction turnover.
Away from traditional galleries and auctions, online art buyers were turning to cryptocurrencies such as Bitcoin, raising questions about the impact the emerging technology could have on the art market. According to Scott, in another article for the New York Times, the ability to trace provenance through blockchain technology makes cryptocurrencies particularly useful for art buying. He predicts that if the currencies don’t collapse under the weight of financial speculation, they present a game changer in the art market.