Lots of bargains but few buyers in store

By Xiao Changyan (China Daily)
Updated: 2008-11-20 08:11

"Half and Half" from contemporary artist Wang Huaiqing. Base price, 4 million yuan ($585,700). Who will start me off?"

Not a single bid was forthcoming, a scenario repeated many times at China Guardian's Grand Fall Auction, a key event in the art world.

The global recession has clearly cooled the Chinese art market and Guardian's fall auction, known as a barometer of domestic market sentiment, was its latest victim. It ended last Thursday with final takings of 360 million yuan ($52.78 million), only one third of the 993 million yuan ($145.6 million) from the company's spring auction.

Contemporary art suffered the greatest plunge. Only half the lots were sold and the highest price among them was only 2.97 million yuan (for Wang Qidong's A White Cloud), while at the spring auction it had been 57 million yuan (for Liu Xiaodong's Hot Bed No.1).

Nor were buyers tempted by the greatly reduced prices indicated by organizers. Wang Huaiqing's Half and Half, for example, failed to attract a bid at 4 million yuan, while at the spring auction Wang made a record 28 million yuan for the painting Homeless Furniture.

Things are so bad that Beijing Huachen Auctions, another big group in China, canceled all its contemporary art sales at its fall auction last week. General manager Gan Xuejun called it a "cautious but necessary" measure amid the economy turmoil.

Three weeks ago, Sotheby's fall auction in Hong Kong only proceeded with half its contemporary art lots.

The slump at the major auction houses seems to mark the end of a four-year boom in Chinese contemporary art, a golden age for artists like Zhang Xiaogang, Yue Minjun and Zeng Fanzhi.

Chinese art website Artron.net also showed a 14 percent fall in its Chinese contemporary art index this fall, compared with the spring, while its benchmark index of 400 top Chinese artists showed a 28 percent decline for the same period.

Mei Jianping, an academic who created the Fine Art index, a widely cited measure of performance in art markets, estimated contemporary art could plunge by 50 percent.

Although the whole industry is beset by pessimism, many professionals insist the end of the good times for Chinese contemporary art could be a blessing in disguise.

"Many Chinese contemporary artworks are overpriced," says Zhang Yiwu, a professor at Peking University. "Now it is time to squeeze out the bubbles."

Dong Mengyang, curator of the annual Art Beijing Expo, shares Zhang's opinion: "Like shares and real estate, Chinese contemporary art has been regarded as newly profitable and most people buy them just for investment, not for art appreciation. The astounding prices of some contemporary artworks have no relation to their art value."

He believes the global downturn and withdrawal of speculators will ease the Chinese contemporary art market into an adjustment phase that will last for at least a year.

Art critic Gao Minglu is forecasting that as much as 80 percent of contemporary artworks will eventually be eliminated and that the prices of those left standing will also fall to rational figures.

Dong agrees: "Chinese contemporary art will benefit from such a cleaning up. Buyers and collectors will resume their intense scrutiny on the artistic value of works."

(China Daily 11/20/2008 page18)