The newly published The Art Market 2020 report provides a timely insight to the way that COVID-19-related disruptions are most likely to affect growth and earnings in the world art industry.
The report quotes international art market earnings in 2019 were values US$64.1 billion (A$97 billion), down 5 percent on 2018.
This fall reflects the decrease in global economic expansion driven by rising geopolitical tensions as well as the tendency toward trade protectionism directed by the USA.
The European Fine Art Fair in Maastricht moved forward, but reported a 27% fall in attendance of VIPs in the launch, when many significant earnings are traditionally created.
The Developing Art Fair Industry
As in preceding decades, 2019 artwork market sales were exceptionally concentrated in three main hubs. The United States of America, the Uk and China jointly accounted for 82 percent of the Whole value of earnings.
The total dealer sector (like trader, gallery and internet retail revenue) represented 58 percent of overall art marketplace earnings in 2019, together with the value of earnings increasing by 2%.
In this sector, traders with turnover of over US$1 million (A$1.5 million) experienced a considerably bigger increase of 20 percent. These traders are the fastest-growing industry and also the most reliant on artwork fair sales.
Nearly half of earnings in the merchant sector were created at art fairs in 2019, amounting to US$16.5 billion (A$25 billion) 26 percent of sales made from the international art industry.
This concentration of earnings in the very top end of the trader market is possibly the art market’s Achilles heel when contemplating possible fallout in the approaching COVID-19 pandemic.
Traders within this turnover mount attended twice as numerous art fairs as younger traders, with global fairs (instead of local fairs) leading to over half of their complete artwork fair sales.
For traders with turnover of over US$10 million (A$15.1 million), global art fairs represented a staggering 70 percent of the artwork fair sales.
An Undesirable ‘Diversion’
Apart from the earnings generated at art fairs, dealers are now increasingly determined by sidewalks for enlarging customer listings and growing their companies.
A dealer quoted in The Art Market report mentioned that the undesirable effect disruptions from beyond the art world could have on artwork marketplace requirement.
While this trader was likely referring to external political issues, for example Brexit or trade sanctions, the COVID-19 outbreak has the capacity to offer a much greater “diversion” for art buyers. The effects of COVID-19 about the long-term wellness of the art marketplace remains to be seen.
Art fairs had been fighting because of numerous financial headwinds from the latter portion of 2019, with rising quantities of retractions and cancellations global. This is a critical event in the regional calendar and its reduction into the 2020 art marketplace will be felt.
The worldwide footprints and nimble company structures of worldwide auction houses may assist these companies weather this storm, even because they’ve done previously. However, the picture is stressing for business galleries. Galleries and artists prepare for months ahead of fairs and exhibitions.
At a poll of the effect of the coronavirus on the art market in China, 73.8percent of respondents in the visual arts sector reported that their companies won’t survive for more than three months when the present containment situation persists.
But with doubt about how much time it’s going to be until this pandemic is under management, the long term health of the global art sector is yet to be determined.