Hong Kong Art Market Resilience

Despite Turbulence and Pessimism in 2019
By A&M

Key Points

• Sotheby’s topped the Autumn 2019 season with HKD1.6 billion total sales of modern and contemporary art

• Asian art performed well in general with notable record sales, while the sale of art from Southeast Asia was generally sluggish

• Indonesian art led all Southeast Asian country sectors in terms of total sales, fetching HKD66 million despite overall declining sales

• Vietnamese art continued to shine, with increased lot count and second-highest total sales of HKD51 million across all houses.

Overview
The Hong Kong Autumn 2019 auction season for modern and contemporary art concluded at the end of November with a note of resilience against the twin backdrop of an uncertain global economic outlook and the tumultuous political situation in Hong Kong. Sotheby’s topped the season with a healthy total sale of HKD1.611 billion (USD205.8 million) despite a dip of 11.5% from the previous season. Christie’s fetched a total sale of HKD1.243 billion (USD158.8 million), a slight increase of 7.8% from the Spring 2019 season.

Sanyu, ‘Five Nudes’, 1950s, oil on masonite, 120 x 175cm. Image courtesy of Christie’s Images Ltd. [2019].

Kim Whan-Ki, ‘05-VI-71 #200 (Universe)’, 1971, oil on cotton (diptych), 254 x 254cm. Image courtesy of Christie’s Images Ltd. [2019].

Buyers appeared to be undeterred by the turbulence in Hong Kong. This was evident in the world record prices of Sanyu’s ‘Five Nudes’ and Kim Whan-Ki 05-VI-71 #200 at the Christie’s 20th Century & Contemporary Art Evening Sale which took place at the end of November, and Yoshitomo Nara’s ‘Knife Behind Back‘ at Sotheby’s Contemporary Art Evening Sale in early October. Indeed, anxiety from the protests echoed in the relatively sparse attendance at salerooms across all auction houses, this was well compensated for by a healthy number of phone bidders.

Sluggish Southeast Asian Market
Southeast Asian art experienced a challenging season, raising a mere HKD167.8 million (USD21.4 million), a massive 47.9% plunge from the Spring 2019 sale season. The plummet was most discernibly registered in a large number of unsold Indonesian works, with overall sell-through rate dropping from a robust 81.2% in the preceding season to an alarming 54.1% in the Autumn 2019 season. Conservative Indonesian collectors seemed to be reluctant to deaccession key pieces and the sourcing of consignment was difficult for all auction houses across the board. Christie’s, for instance, cancelled its Jakarta preview of modern and contemporary art due to the lack of consignments coming from Indonesia.

Mai Trung Thu, ‘Nude’, 1970, ink and gouache on silk, 47 x 70cm. Image courtesy of Christie’s Images Ltd. [2019].

Natee Utarit, 'King 《 國王》', 2011, oil on linen, 200 x 320cm. Image courtesy of Phillips.

Market watchers wonder whether a market bubble for Southeast Asian art market exploding is the reason for the plunge in sales figures. In reality, the top Southeast Asian lot of the season, Adrien Jean Le Mayeur de Merpres’ ‘Women on the Terrace’ at Sotheby’s sold for HKD10.97 million, making it one of the top 10 most expensive works of the artist sold at auction. Vietnamese modern artist Mai Trung Thu and Thai contemporary artist Natee Utarit broke their auction record prices this season at HKD3.96 million and HKD2.75 million respectively. These superlative sales show that buyers are still actively seeking and bidding for exceptional works, and are not afraid of breaking the bank for them. However the season turned up a limited number of quality work and many top Southeast Asian buyers were spotted bidding for works by Zao Wou-Ki, Chu Teh Chun, Cai Guo Qiang, Li Chen and Ju Ming amongst other Asian artists.

Despite the tepid performance, Indonesian art retains its position as the biggest market sector in Southeast Asia with a total sale million this season. Notably, this is the first time that Vietnamese art sales has competed neck to neck with Indonesia’s, with only a HKD8.7 million difference as opposed to HKD73 million last season.

Sale values aside, the season saw a satisfactory 72.4% Southeast Asian works sold across the auction houses. Vietnam and the Philippines proved to be the most desirable categories in 2019 with sell-through rates of 80% and 90% respectively, demonstrating the eagerness of Vietnamese and Filipino buyers. Despite the situation in Hong Kong, the majority of Southeast Asian buyers in the salerooms this season were from these two countries.

Prasong Luemuang, ‘Distraction’, gouache on canvas, 122 x 183cm. Image courtesy of Christie’s Images Ltd. [2019].

Undervalued Southeast Asian artists also commanded much attention from buyers this season. The exceptionally large and colourful work of Thai modern artist Prasong Luemuang fetched multiples of its estimate at Christie’s, going to a top Thai collector. Three phone bidders competed for Indonesian post-war abstract artist Fadjar Sidik’s ‘Garuda’. It finally went to a top Indonesian client at HKD120,000 (HKD150,000 after premium) against the low estimate of HKD50,000. Collectors not only looked for top-of-the-line works of established artists but were interested in the works of historically undervalued Southeast Asian artists.

Buyers’ preferences proved polarising this season, leaving no room for works of middling quality. Buyers needed to be enticed with works that offered distinct values – be it exceptional quality, rarity or investment value. Sales in 2020 seem set to be heavily dependent on auction houses’ ability to get sellers to release key works. If not, the market risks a repeat of this season’s unexceptional results.

2020 Auction Spring Schedule:
March/April 2020 (Art Basel Hong Kong 19-21 March)
Christie’s 20th Century and Contemporary Art Evening Sale
Sotheby’s Modern and Contemporary Art (Evening & Day Sale)
Sotheby’s Modern and Contemporary Southeast Asian Art (Evening & Day Sale)
Bonhams Modern & Contemporary (Selling Exhibition)

May 2020
Christie’s 20th Century and Contemporary Art (Evening & Day Sale)
Phillips 20th Century & Contemporary Art (Evening & Day Sale)
Bonhams Modern & Contemporary Art