Summarize this content to 2000 words in 6 paragraphs in Arabic International art sales fell heavily in 2024, even before the potentially seismic impact of US trade tariffs announced last week, finds the latest Art Basel & UBS Art Market Report. Compounding a 4 per cent slide in 2023, values last year slumped 12 per cent to $57.5bn, their lowest level for eight years, excluding the pandemic-impacted 2020. Reduced supply at the highest price levels and waning demand for once-hyped contemporary art resulted in a lower-cost, though higher volume, environment last year.Rising national protectionism in an inherently global market had already dented market confidence, the report finds, a foretaste of President Trump’s “liberation day” tariffs on the US’s trading partners. Protectionist policies “have been shown to be as directly detrimental to national art markets as they are to their economies”, it says. Fears are widespread that the tariffs will put the global trade under further pressure, though many details are not yet codified, including whether or not art could be exempt. “The ease of getting things around in the US is why so much of the art business shifted to New York in the first place,” Clare McAndrew, founder of Arts Economics and the author of the report, tells the Financial Times. “Perhaps the US government could be convinced that art merits special treatment, but [it] is so far down the political agenda.” 1 It’s tough at the topPrice sensitivity at the highest levels deepened last year. Auction sales at the thin, top end of works priced above $10mn fell by 45 per cent, the largest decrease across all segments, while the value of works that sold above $1mn fell 38 per cent. Top-tier art dealers, with turnover above $10mn, suffered the biggest fall of sales in their sector, down 9 per cent on 2023, already down 7 per cent on the previous year. Conversely, dealers with a turnover below $250,000 saw turnover up by 17 per cent, having rebounded more slowly after 2020.2 The UK reclaims second spotWeakness at the top end knocked the leading US market, which historically gets the costliest consignments and accounted for 43 per cent of global sales last year. Here total sales fell 9 per cent to $24.8bn, 12 per cent below their pre-pandemic levels. In China (including Hong Kong), art sales fell the deepest following a temporary uplift last year, by 31 per cent, matching declines in the personal luxury goods market “as consumer confidence continued to fall,” the report finds. The $8.4bn art sales total is China’s lowest level since 2009.The UK proved more resilient — though sales still slipped 5 per cent to $10.4bn — and reclaimed its second spot from China in the world rankings (18 per cent market share versus China’s 15 per cent). In France, touted as a rival to the London market since Brexit, art sales fell more (by 10 per cent) to $4.2bn, less than half the UK’s total, though the country maintained its global share of 7 per cent, making it the fourth-largest market worldwide.3 A sharp drop for contemporary artSales values in the biggest sector of the art market — postwar and contemporary art, or artists born after 1910 — fell for the third year in a row at auction. The drop was particularly sharp for the volatile contemporary portion, defined as works by artists born after 1945. This was down 36 per cent on the year and 60 per cent since its 2021 peak. Within the category, the so-called “ultra-contemporary” segment of works made in the past 20 years fell by 43 per cent, “leaving the market just over one-third of its size in 2021”, the report finds. The trend hit art dealers too — those who traded only in contemporary art experienced an 11 per cent fall in sales in 2024, versus stable or increasing sales in most other fine art sectors. 4 Magritte dethrones PicassoLeading the charts at auction last year was René Magritte, with a total $312mn of sales, topped by his famed “L’Empire des Lumières” (1954) painting of a house by night set against a daytime blue sky, which made an artist record of $121mn and was the only work to sell for nine figures in 2024. The surrealist painter knocked Pablo Picasso from the top slot that the artist had enjoyed for the past six years — this time he slipped to third place, after the impressionist Claude Monet.5 There’s one bright spotThe report finds some consolation in the increased volume of sales, as lower price levels proved appealing to new entrants. Overall, the number of transactions was up 3 per cent in 2024, marking four years of growth post-pandemic and boosted by greater reach through ecommerce, the report finds. Online-only transactions accounted for 18 per cent of the market last year, with the majority of these (99 per cent by volume, 62 per cent by value) made for art under $50,000 at auction. This lower-cost, higher-volume dynamic is “a really healthy development for the market — making it less elitist and more democratic,” says one dealer anonymously quoted in the report, which surveyed nearly 1,600 to access their normally private information.6 Shipping costs have ‘skyrocketed’The problem remains the rising cost of doing business in this still largely in-person market. Turnover might be up for smaller dealers and many mid-tier auction houses, but profitability is biting all round. Operating costs, encompassing salaries, rent and IT, were found to have grown an average 10 per cent in 2024, while ancillary expenditure, notably the costs of art fairs and associated shipping and packing, has “skyrocketed” recently and these were up 10 and 15 per cent respectively in 2024, the survey finds. Dealers are increasingly cutting their art fair attendance. “Participation in even the best-reputed art fairs is currently too expensive for a small avant-garde gallery that is not an aristocrat’s plaything,” says another dealer quoted in the report.Noah Horowitz, chief executive of Art Basel, acknowledges the rising cost environment, including for his own events. He says “it is true that galleries need to be much more strategic about how and where they are spending their money, and what they hope to get out of [art fairs] — waiting for things to happen of their own accord is not a reliable business strategy in our industry, or any other.” But, he adds, “we invest substantially in delivering the right audiences for our shows and to help galleries put their best foot forward.”7 Tariffs sow uncertaintyOther concerns aired in the report surround an ageing collector base, though the early signs of the great wealth transfer — for which UBS estimates $84tn to change hands over the next 20 years — are already bringing younger and more engaged collectors to market, they find. The survey cites easing inflation as a recent “welcome development” for the art market, though the expectation — as UBS flags in the report — is that the economic impact of tariffs means this is likely to grow again, “impacting global trade flows and adding uncertainty for multinational businesses.”With ongoing wars and other mounting tensions around the world, it is hard not to hear alarm bells beyond last year’s slump. As McAndrew says, “You only need a few good, catalytic things to happen to turn the art market around, but all the big, external markers are all negative at the moment.”artbasel.com
