The impact of the Covid 19 pandemic caused the global art market to contract by more than one fifth, according to the findings of the annual Art Basel and UBS Art Market Report.
The report, released today, says global sales of art and antiques reached an estimated $50.1bn in 2020, down 22% from 2019. A significant portion of business did move online with digital sales of art and antiques reaching a record high of $12.4bn, accounting for 25% of the market’s value and effectively doubling in value year on year.
As the number of live auctions diminished and businesses were forced to close for much of the year, the declines in both the value and the volume of works sold were consistent across all price segments of the art and antiques market.
There was little change to the traditional hierarchy. The three core art dealing hubs – the US, the UK, and Greater China – continued to account for a majority (82%) of the value of global business in 2020. Although sales in the US art market fell by 24% in 2020 to $21.3bn – its biggest fall since 2009 – the market retained its leading position, with 42% share of all sales.
Greater China and the UK were on par at 20% despite similar falloffs in transactions. Sales in the UK declined by 22% in 2020 to $9.9bn, their lowest level in a decade.
Specifically, sales at auction were down a total of 30% year-on-year at $17.6bn. Some but not all of that can be accounted for by a rise in private sales by the leading auctioneers that were estimated to have reached over $3.2bn in 2020 (up 36% from 2019).
Impact on dealers and fairs
Aggregate dealer sales were estimated to have fallen by around 20% to $29.3bn in 2020, after a marginal increase of 2% in 2019. The ability to reduce major operating costs did allow some dealers to maintain profitability – some 28% reported being more profitable in 2020 than in 2019 with a further 18% maintaining a stable level of net profit. However, more than half of those questioned said profits had fallen markedly.
Unique to 2020 most business was done without reliance upon art fairs. An analysis of 365 international fairs showed two in three (61%) were cancelled – a massive drop that meant live events accounted for just 13% of dealers’ total sales.
As both dealers and auction houses looked to digital solutions, online sales reached a record high of $12.4bn. By volume, 22% of the lots sold in 2020 were in online-only sales, double the share in 2019.
Shift to online
The financial share accounted for by online sales also expanded markedly from 9% of total sales by value in 2019 to 25% in 2020. Alongside the closure of ‘non-essential retail’, time available for screen surfing as people worked from home was deemed a key factor. Some 66% of the 2500 ‘high net worth’ collectors surveyed for the report felt the pandemic had increased their interest in collecting.
Report author, Clare McAndrew of Arts Economics, said: “The fall in sales was inevitable as the art market is populated by small businesses that rely on discretionary purchasing, travel and personal contact. But the Covid 19 crisis also provided the impetus for change and restructuring, the most fundamental shift being the rollout of digital strategies and online sales, which had lagged behind other industries up to now.”