Ryutaro Katayama, Managing Director of Christie's Japan, on the Asian Art Market
Source:Artinfo Date: 2013-05-21 Size:
Ryutaro Katayama, managing director of Christie’s Japan, is in visibly high spirits when he welcomes me at his offices in Marunouchi on a warm, sunny spring afternoon. Ebullient sales reports had just come in from New York the previous day, where spring sales of postwar and contemporary art set a new historical benchmark for a market plagued by suspicions of a bubble for some time now.

Darryl Jingwen Wee

 Ryutaro Katayama, managing director of Christie’s Japan, is in visibly high spirits when he welcomes me at his offices in Marunouchi on a warm, sunny spring afternoon. Ebullient sales reports had just come in from New York the previous day, where spring sales of postwar and contemporary art set a new historical benchmark for a market plagued by suspicions of a bubble for some time now.

Kicking off on May 13 with the 11th Hour Auction, the biggest wildlife charity auction ever staged in conjunction with the Leonardo DiCaprio Foundation, Christie’s raised US$38.8 million through 33 artworks by artists like Mark Grotjahn, Robert Longo, and Zeng Fanzhi. This was followed by the triumphant Evening Sale on May 15, which raised $495 million, the highest total in auction history.

In total, Christie’s raised a staggering $638.6 million last week, setting 37 new sales records, including world auction records for Jackson Pollock, Roy Lichtenstein, Jean-Michel Basquiat, Mark Rothko, and Willem de Kooning at auction.

Recent global sales figures have also been markedly effervescent. Christie’s annual sales for 2012 totaled $6.27 billion, up 10% on 2011, a figure that includes private sales of $1 billion, an increase of 26% on the same period last year. This is the highest-ever annual total for both Christie’s and the entire art market in history. Later this year, the company is planning to enter the Chinese market as the first international auction house to operate on the mainland without a local partner (Sotheby's, on the other hand, set up a Chinese joint venture with local state-owned company Beijing GeHua Art Co. last year).

I asked Katayama-san to take apart these impressive figures with a more analytical and exacting eye, and asked him about his personal views on recent trends in the Japanese and Asian art market in general.

Sotheby’s faced a difficult global environment last year, with a first quarter that saw sales volume fall by 7% over Q1 2012, apparently due to lower auction commissions and higher operating costs. The former was blamed on thinner margins at the very top end of the market — which means higher net sales, but lower actual profits. Has Christie’s been facing similar challenges?

These figures are true, but they may give people a misleading impression. For one thing, it is entirely unrealistic to expect to see constantly rising sales figures — there are always going to be fluctuations from quarter to quarter and year to year. The “thinner margins” you mention are actually an inescapable statistical reality: although the seller’s commission on a sale rises in proportion to the final sale price, the buyer’s commission doesn’t change. This means that the profit margin as a percentage of the price of the artwork necessarily decreases in relation to a higher price, even if the total sales volume and revenue is still higher.

You might say that our portfolio — or the structure of the price categories that govern our artworks — is diversified in a way that allows us to maximize our profits by offering lots across a wide range of price brackets. Our South Kensington salesroom in London, for instance, which focuses on artworks from the £1,000 and under price range, has been growing steadily over the past few years, logging the highest ever total for the third consecutive year in 2012. At this range of the market, we’ve never done better in terms of profit margins.

What is your response to the oft-quoted assertion that Japanese are not big collectors of art? Does this apply more to contemporary, modern, or classical art, and is this a question of whether the collections are public/private? At our previous interview, Francois Curiel confided that most of the buyers in Japan tend to be “private”.

While Tokyo apparently has the greatest number of millionaires (461,000), the figures are very different for multi-millionaires and billionaires, which are concentrated in places like London and New York, Hong Kong, and Moscow. By country, the US tops the list with 5.23m, with Japan in second place with 2.1m. At the very highest echelons of global wealth held by individuals who are potentially big collectors of art, therefore, Japan doesn’t come up very high in the rankings. The fact that Japan is one of the world’s wealthiest countries, combined with the fact that this wealth is not nearly as dramatically skewed towards a small cadre of multimillionaires and billionaires as other Western countries, might have something to do with the perception that there are no “big” collectors in this country.

We do have ardent Japanese collectors mostly of modern masters like Dali and Miro, for instance, but when it comes to contemporary art, many people profess that they don’t understand it. The desire to turn one’s home into an art museum and open it up to people is also less established and accepted here — and perhaps that may have something to do with the fact that fewer Japanese have palatial residences that would allow them to do something like that. But also, there are some other factors — we have dealt with clients who have been buying art all along, but come to us one day and say, “I’ve never loaned my art out to a museum for an exhibition. How should I go about it?” They see art collecting primarily as doraku — a hobby or pastime.

Perhaps that’s what Mr. Curiel meant when he said Japanese collectors tend to be “private”. In America, whenever you make a donation to an institution, whether it’s art-related or not, you typically get a gallery or auditorium named after you in recognition of your contribution. In contrast, we recently had a client who was considering making a donation of artworks to a museum, and all he wanted in return was a letter of appreciation! You might call this excessive modesty, but I think there really are some culturally specific factors in the case of Japanese collectors that tend to keep the whole business rather low-key.

We also recently interviewed members of the committee of the Ginza Galleries Association, who told us that there are still lots of barriers that inhibit the development of the art market and collecting culture in Japan. There isn’t so much of an open dialogue between gallerists, collectors, and art lovers, even though museum attendance figures are among the highest in the world. What is your personal interpretation of this situation?

There seems to be a sense of distance between collectors and artists, too, and a fear that one doesn’t have the requisite knowledge to even enter this rarefied world. And even if one is genuinely interested in the art, most people don’t know whom they should approach to take that interest further. Of course, you can get a basic picture of the contemporary art scene online, but the profession of art advisers and consulting services still isn’t quite recognized and established in Japan.

Speaking of Ginza, there are many top restaurants and haute cuisine establishments in that area that practice what we call “ichigen-san kotowari” — the custom of refusing those who haven’t been properly introduced. Many cultural pursuits begin with an introduction. This isn’t something that is unique to Japan, however — look at all the private social clubs in Europe, for instance. Even if this isn’t actually the case in the art world, there is definitely this impression of things in Japan — that things are closed, exclusive, and open only to the initiated.

What would you say are some of the distinctive features of the current market for contemporary art in Japan as opposed to Hong Kong, Greater China, and the rest of Asia?

In my opinion, interest in Western and contemporary art in China is still fairly low. Collectors tend to go for big names and brands — particularly for what you might call the pioneering modern Chinese diaspora artists, like Zao Wou-ki and Chu Teh-Chun, the market for which continues to grow steadily. There is still little of what we call "cross-market" activity — collectors buying works by artists from other countries.

Last year, we launched a series of online-only sales that focus on Japanese artists, reaching out to a younger generation of collectors who are completely comfortable with web-based platforms for buying and selling art. In 2012, 19% of all registered bids at our global auctions were placed by new clients, and an impressive 39% of clients at our inaugural season of online-only auctions consisted of new buyers. This suggests that there is still a large, untapped, and internet-savvy demographic of potential art collectors, many of which are based in Asia. 

Christie's holds its Hong Kong spring sales of Asian 20th Century & Contemporary Art, Chinese modern paintings, ceramics, and more starting this weekend, from May 25—29, at the Hong Kong Convention and Exhibition Center.

[Editor] Lola Xu