HELVOIRT, THE NETHERLANDS — The 2016 TEFAF Art Market Report, presented by Dr Clare McAndrew on March 11 during fair’s Art Market Symposium, shows that global sales fell 7 percent during 2015 from $68.2 billion to $63.8 billion and the volume of sales declined by 2 percent to $38.1 million. The picture that emerges in 2015 is of a highly polarized market, whereby most of the value within the market is shared between two sectors – postwar and contemporary and Modern art — and is concentrated in sales at the very highest price levels.

Although the global sales figure fell in 2015, sales in the United States rose by 4 percent to their highest ever total of $27.3 billion, confirming its position as the global market leader, with a 43 percent share of total sales values. The United Kingdom, in second place, had a 21 percent share and China accounted for 19 percent by value.

From 2012 – 2014, China remained significantly smaller than the United States but ahead of the United Kingdom, which was third in global rankings. In 2015, against the backdrop of economic contraction and uncertainty alongside poor sales in many sections of the auction market, the Chinese market experienced a significant decline, with total sales dropping 23 percent to $11.8 billion. The United Kingdom regained its position as the second largest market worldwide in 2015, despite sales falling 9 percent in value to $13.5 billion; sales overall in Europe were patchy and generally stagnant.

The market remained dominated by value at the high end. Works sold for more than $1 million accounted for the majority of value in fine art auction sales (57 percent) during 2015, despite representing less than 1 percent of all transactions. Sales at this level continued to be generated by a tiny fraction (1 percent) of all artists selling work at auction, as the focus of many high-end collectors continued to be centered on a narrow group of artists.

Growth in the $1 million-plus segment far outpaced growth in all other segments. In the decade to 2015, this segment grew in value by 400 percent, four times or more than the rate of growth in sales in the low and medium segments. Within this high end, the ultra-high end (works priced more than $10 million) also outperformed, with more than 1,000 percent growth in the same period. This ultra-high segment accounted for 28 percent of total sales by value in 2015 despite representing a very small fraction (0.1 percent) of overall transactions in the fine art auction market, and was the only segment of the market to increase in value over 2015 (advancing 19 percent year-on-year).

Private sales by dealers and other agents accounted for 53 percent of the total market by value, with sales at auction accounting for 47 percent. Furthermore, dealers estimated that 40 percent of their sales on average were made at art fairs in 2015. Despite declining global sales overall, the online sector continued to be a focus of attention and a relative bright spot in the market, with sales increasing 7 percent year-on-year. In 2015, sales of art online, which included online sales by traditional off-line dealers and auction houses, were estimated to have reached $4.7 billion or 7 percent of the global market by value.

The largest single sector continued to be postwar and contemporary Art, which accounted for 46 percent of the market by value and 41 percent of transactions. Following two years of significant growth, however, sales at auction fell by 14 percent to $6.8 billion with a 20 percent drop in the number of transactions.

Sales of Modern art did relatively better and were where the highest record prices at auction were found in 2015, including the world record prices for works by Picasso and Modigliani that both exceeded $170 million each. The sector fell by 1 percent to $4.5 billion although the number of transactions declined by 20 percent. This sector accounted for 30 percent of the fine art auction market by value and 27 percent by volume.

Sales at auction of European Old Masters showed a moderate increase of 4 percent by volume, although sales values fell by 33 percent. European Old Masters accounted for 6 percent of lots sold and 4 percent of fine art sales at auction. In contrast, private sales of European Old Masters, which made up a very important component of aggregate values, were particularly strong.

In addition, some of the decorative art sectors showed a positive trajectory over 2015. One of the largest decorative art sectors, Chinese decorative art and antiques, increased 6 percent year-on-year to $2.2 billion, with porcelain and ceramics garnering some of the highest prices.

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