As Chinese art market crashes, many artists applaud
Chinese contemporary painters hope the collapse will shake out speculators, leaving true collectors.
Beijing — One of the best ways to make a quick buck over the past few years has been to buy contemporary Chinese paintings. The fastest-growing sector of a feverish international art market saw prices leap by multiples of ten or more.
No longer. The global recession is deflating sales. Today, "the bubble is really bursting," says Beijing painter Zhao Gang, as prices tumble by nearly one-third and record-setting Chinese artists watch their works go unsold at auction.
But few people in the art world here are lamenting the end of an overheated era. "Chinese artists were seen as ATMs," says Jerome Sans, director of the nonprofit Ullens Center for Contemporary Art in Beijing. "Maybe now they'll stop creating for the market and create for the mind."
Maybe too, he suggests, as the internationally fueled boom runs out of steam, local artists will turn their attention to local buyers, who are just beginning to build a collectors' market.
Prices for Chinese contemporary art have skyrocketed over the past five years. In 2004, only one of the top 10 best-selling living artists was Chinese, according to the artprice.com website, But by 2007 five of them came from China.
Among them was Yue Minjun, whose paintings of broadly grinning men in a variety of settings have been imitated widely here. "Gweong Gweong," a painting he made in 1993 and sold a year later to a dealer in Hong Kong for $5,000, was worth $636,000 by the time it came up for auction in November 2005.
Last May, it was flipped for $6.9 million.
A handful of other star painters have commanded auction prices in the millions of dollars. Their staggering success has attracted a host of artists feeding a voracious network of galleries that has sprung up here.
"A lot of gold diggers appeared," complains Sheng Qi, a London-trained artist who has seen the price of his paintings rise steadily in recent years. "Anyone could be an artist."
The boom also attracted speculative dealers and collectors, drawn to a market that was expanding even faster than the speed of China's headlong economic growth. "Paintings became just like any other commodity," says Mr. Qi.
"A lot of strange birds came out of the woods," says Mr. Zhao wryly, referring to the speculators who drove the market for Chinese art. "Now they have heard the guns."
"You could see that this would explode one day," says Mr. Sans. "Some prices were beyond craziness. These people were making money on the backs of artists, selling paintings in six months. That's not collecting; it's just making money.
"These people will disappear now, and I am very happy about it," Sans adds.
Also likely to disappear as dealers and collectors become more discriminating, predicts Qi, are lesser talents. "The crisis is a good thing," he argues. "There won't be a lot of people painting a lot of trash, and the market will be cleaner.
"People who love art will continue to do so, and those who were only pretending don't need to pretend any more," he says.
In the meantime, though, the slump is hitting even respected artists.
Zeng Fanzhi, one of whose older paintings was bought for $9.7 million at auction a year ago, sold only a third of the paintings on display at the opening night of his first one-man show in New York last week.
Last year, says Fabien Fryns, owner of the F2 gallery here and a friend of Mr. Zeng, "The show would have sold out even before the opening" and "prices would have been 20 percent higher."
The fact that he did sell nine paintings, at prices ranging from $100,000 to $1 million, however, "shows that quality at the right price still sells," Mr. Fryns argues. "The buyers were really serious collectors," he adds. "Last year, maybe 50 percent of the works would have been sold to speculators."
Some mid-level artists, though, are finding life harder. "I know people who haven't sold a picture for six months," Qi says. And while none of the major Beijing galleries have closed, many smaller ones in the once-vibrant "798" art district have either shut their doors or turned themselves into coffee shops or fashion stores.
Auctioneers also are being cautious. At an early spring sale last week, one of China's largest houses, the Poly International Auction Co., "included more low-price items than last year, to attract more buyers," spokeswoman Liu Jing told the state-run Xinhua news agency.
"We also increased the number of items without a starting price," she said. "It's like a sale."
That policy appeared designed to hold the market up in the wake of a disappointing auction season last autumn, when Poly brought in only $59 million, compared with $152 million in the spring season, mostly from Chinese buyers.
That drop suggests that the local market is still weak. But Sans says he believes "there is a huge chance the local market will develop in the next few years."
Fryns, the F2 owner, also predicts that "a much stronger Chinese market will emerge" and says he is "pretty confident" that new Chinese collectors will buy from domestic artists as well as from established Western names.
In the long run, says Zhao, the cooling market means that "people will take more time to take a serious look at art" in China. "If you are serious about art, the crisis is good," he believes. "But it's not very good for speculators."