AI Created Art

 The NY Times has a very interesting article on works being created with artificial intelligence and algorithms. Christie's has a sale on Thursday on “Edmond de Belamy, from La Famille de Belamy.” The work is estimated at $7,000 to $10,000 and was created by students, none with a major in fine art.

This certainly brings up many questions, as the work is generated by computer based upon thousands of portraits used to generate the new work. So is it art? How will it be viewed in the future. There is also concern from artist who work with AI  and digital creations to create innovative works.

Is it also a precursor of what is to come from auction houses such as Christie's, Sotheby's and Phillips? Just because it can be does not mean it should be done. If the AI generated art is just a conflation of images used to produce a new work generated by a computer, is it really art, or appreciable art.

The NY Times reports
With their eyes trained on a gilded frame containing a smeared, half-formed image of a distinguished gentleman, a small group of potential bidders gathered Friday night over cocktails at Christie’s New York and heard the pitch: here was the first portrait generated by an algorithm to come up for auction. The portrait, produced by artifical intelligence, hung on the wall opposite an Andy Warhol print and just to the right of a bronze work by Roy Lichtenstein.

There were some smiles and at least one frown. Two people snapped cellphone pictures of the work, which looked as though someone had taken a sponge to a 17th-century oil portrait. The arrival of what some call the infant stages of the next great art movement at one of the world’s leading auction houses was greeted nonchalantly, with a nod of understanding and a sip of mezcal margarita.

Christie’s is hoping for a more explosive reaction on Thursday, when the gavel comes down on “Edmond de Belamy, from La Famille de Belamy,” formally testing the art market’s interest in AI art. The work — estimated at $7,000-$10,000 — was a collaboration by the members of Obvious, a French trio composed of a student of machine learning and two business school graduates, none of whom have a background in art. There was no paint or brushes involved, just an algorithm that learns to imitate sets of images fed by humans — in this case, thousands of portraits spanning the 14th century to the 20th.

But is it art? Frédérique Baumgartner, an art historian at Columbia University, said the work raised questions about “intention and authorship.” She went on to compare the portrait’s contrasting tones, coupled with the subject’s sober dress, with the old master of the Dutch Golden Age, Rembrandt van Rijn — though she quickly added, “That’s if I look half-closing my eyes.”

The unusual sale shows the challenge traditional auction houses face staying relevant in a culture that moves at WiFi-enabled speeds. Christie’s — which shattered auction-house records in 2017 when it sold a $450 million Leonardo da Vinci painting — reached out directly to Obvious this year, rather than working through a seller. (It is the only AI work in Thursday’s sale of 363 lots.)

Surprisingly, the loudest criticism has come not from the art establishment but from the small but passionate community of artists who work with AI, many of whom say that what Christie’s and Obvious suggested was groundbreaking was in fact effectively AI Art 101. Ahmed Elgammal, the director of the Art and Artificial Intelligence Laboratory at Rutgers University, said that the technology used to create the work, Generative Adversarial Networks, or GANs, had been used by artists since around 2015. “This group was totally irrelevant,” he scoffed.

Mario Klingemann, a German artist known for his work with GANs, put it bluntly. “When I saw that announcement” of the auction, he said, “my reaction was ‘you can’t be serious.’” He compared the portrait by Obvious “to a connect-the-dots children’s painting.”

Richard Lloyd, the International Head of the Prints & Multiples department at Christie’s, who brought the work in, acknowledged that he hadn’t made an exhaustive search of the small but very active field of AI art. “I just responded to it and thought it’d be cool,” he said.

He added of AI art, “It’s just a personal sort of interest I’ve had for quite a few years.” He said he had been inspired by a report earlier this year that Nicolas Laugero Lasserre, a French collector, had privately purchased a portrait from Obvious, for about 10,000 euros, or about $11,400.

What struck Mr. Lloyd most, he said, was the work’s resemblance to European portraiture. “It looks like something you’d expect Christie’s to sell,” he explained. “We’re the people who sold the Leonardo for $450 million.”

He thought that the work Obvious was doing would be a good way to ease potential buyers at Christie’s into work made with AI. “I like the fact that it didn’t at first blush look different,” he said.

Many artists and researchers who specialize in artistic applications of AI technology, while generally glad of the potential exposure the sale could bring, say that the portrait chosen by Christie’s is derivative. Codes written to produce the kind of images Obvious has made are also shared freely online among enthusiasts, raising questions of originality.

For its part, Obvious acknowledges that the technology it used was gleaned from others. “It’s open source,” explained Pierre Fautrel, one of the group’s members, in an interview in New York last week. “We took a lot of different parts from different people.”

The biggest difference between the Obvious portrait and their predecessors’ is the fact that Obvious had theirs printed on canvas and “signed” in the bottom right corner with a mathematical function used to produce it. They also had it extravagantly framed. “We’re introducing it to people who do not necessarily know what a GAN algorithm is,” Mr. Lloyd explained, speaking to the presentation. “It has to be, all things being equal, comparatively simple.”

The opportunity to capitalize on the buzz surrounding artificial intelligence fits in with Christie’s efforts to market itself in new ways.

In July it held its first Art & Tech summit, focused on the theme of blockchain, the technology behind cryptocurrencies like Bitcoin. (Obvious themselves have sold art on SuperRare, an online marketplace that allows users to buy and sell digital artwork using cryptocurrency.)

Brick-and-mortar auction houses have been slow to accept art that explores new technologies. To be sure, Sotheby’s, Christie’s and Phillips offer plenty of digitally generated works by blue-chip artists like Andreas Gursky and Christopher Wool. But the sort of digital video and virtual reality pieces that are featured routinely at contemporary art biennials rarely, if ever, appear at auction houses.

Artists in the field are hoping that works sold at auctions like Christie’s will increasingly enter private collections. That appears to be happening more often. Earlier this year the New Delhi art gallery Nature Morte hosted what was billed as India’s first exhibition of work made entirely by AI, including works by Mr. Klingemann, Tom White, Memo Akten, Jake Elwes and Anna Ridler. In December, Dr. Elgammal of Rutgers will exhibit AI art for sale at Art Basel Miami Beach.

Who knows what art historians of the future will say about these works and the impact of AI as a tool for artists. But Dr. Baumgartner at Columbia offered a gut response to the Obvious portrait.

“It’s just so strange,” she said.
Source: The NY Times 


Hong Kong Auctions

artnet news looks at the recent fine art sales from Hong Kong. artnet news reports unsurprisingly the market is strong at the top end of the market, which is pretty much the case across the art market. What is interesting is the strength of western artists in the Asian geographic area. Non Asian art sold at three times the rate as last year. The strong sales also come at a time when Asian stock markets and indexes have been falling.

artnet news reports
Although you could be forgiven for thinking otherwise, Banksy’s remote-controlled theatrics at Sotheby’s London weren’t the only auction developments worth tracking this month. A quick look at the data from Sotheby’s and Christie’s most recent fine art sales in Hong Kong suggest that the regional market for Asian and western works alike took a leap compared to Octobers past.

That leap reveals some important lessons about where the region’s market is headed. In short, the market is looking increasingly top heavy (not unlike most major art markets) and increasingly interested in the work of western artists. Work by non-Asian names garnered nearly triple the amount it generated during the equivalent period last year.

Below is a chart showing the total sales value for fine art lots purchased at Sotheby’s and Christie’s Hong Kong during recurring sales held between September 30 and October 8 over the past five years. (In other words, the data do not include one-off or limited sales, like works from the Speelman Collection at Sotheby’s in October.) This approach does not make the years uniform, but it attempts to minimize variation as much as possible.

As always, numbers come courtesy of the artnet Price Database and include buyers’ premiums unless otherwise noted.

A New High for Art Sales
Overall, fine art sales in this period reached a new high of about $260.7 million. The bulk of the activity here belongs to Sotheby’s, which holds a concentrated week of auctions in Hong Kong ending no later than October 8 every year. Christie’s hosts a handful of sales during that time, but it reserves its dedicated week of fall art auctions for late November.

The chart above shows the largest year-on-year jump in the sample period: a roughly $63.5 million increase from what was already a healthy rebound year in 2017. (Remember, the Chinese stock market crashed in the summer of 2015, so sales activity was generally depressed both that year and the following one.) The question, as always, is how much we can or should read into this leap.

Sotheby’s Hong Kong set two notable records during this sales cycle. The house pulled in over $200 million through its modern and contemporary art evening sales on September 30. That figure represents the largest cumulative total for its eastern outpost in a night of fine art auctions, and much of that success owes to the $65 million sale of Zao Wou-Ki’s colossal triptych Juin-Octobre 1985 (1985)—a new record for the artist at auction.

Notably, Zao’s work would single-handedly account for the entire year-to-year difference in total fine art sales value during this period. That isn’t a slight on either Sotheby’s or the health of the market. Quite the contrary. It means that, even if you took away the single heftiest lot sold in this period—the most expensive ever from one of the most consistently sought-after artists in the region—buyers would still have spent just as much on fine art in Hong Kong in 2018 as in the previous cycle.

This performance is particularly notable since stocks on China’s Shanghai composite index have been tumbling since January, and took an even more dramatic fall this week.

And in fact, we find another strong growth indicator if we parse the results between artists of Asian heritage and artists of western heritage.

Western Art Boom?
Asian artists (who generated $216.8 million during this period) still proved dramatically more popular than western artists ($43.3 million) among Hong Kong’s buyers this October (as they were this spring). However, their respective increases in 2018 split relatively evenly, with Asian artists gaining $35.8 million versus western artists’ $28.4 million.

That’s a significant development on the westerners’ side of the ledger. Their collective sales value in the 2018 cycle is the highest ever in this period—again, almost triple their 2017 total. It will be worth watching the November sales at Christie’s Hong Kong to see if similar gains materialize. If so, this particular result will look less like a one-year anomaly and a little more like the first step in sustained progress for western artists in the region.

At the same time, we should keep in mind one number crucial to both of these boisterous charts: 972. That was the total number of lots sold to account for the big-money totals above, and it happens to be the fewest of any single October-centric cycle we surveyed at Sotheby’s and Christie’s Hong Kong.

The trend held for both Asian and western artists, too. The latter group clearly didn’t have any works ascend to the heights of Zao’s record-smashing triptych, but their two top lots—PIcasso’s Buste D’Homme Lauré (1969) for $7.8 million and Joan Mitchell‘s Syrtis (1961) for $7.2 million—together brought Sotheby’s more than all western artists in this period last year.

All of which suggests this regional market is climbing on the backs of a handful of high-value artworks rather than growing from a broadening base, just as we’ve seen for years in other regions around the globe. And that should add a subtle note of caution to what is otherwise excellent news for major art sellers in the east.
Source: artnet news 


Banksy Shredder Malfunctioned

Back from my son's wedding this past weekend. All went well and smoothly, everyone seemed to have a great time. The newly weds are now off to Hawaii for a well deserved honeymoon.

I will try to get back to regular posts within the next few days as I get caught back up. I look forward to heading to NYC for the AAA conference, and hope to see many friends there. For more info on the conference and to register click HERE.

Now back to some art and appraisal posts.  According to a NY Times article, the Banksy work, "Girl With Balloon" which was partially shredded after selling at Sotheby's for $1.4 million was actually supposed to be fully destroyed but the shredder jammed.  Interesting, and Sotheby's is still disavowing any complicity in the shredding.

The NY Times reports
LONDON — As the $1.4 million artwork began passing through a shredder hidden in its frame, gasps were heard in the auction room. About halfway through, the shredding suddenly stopped, and the top portion of “Girl With Balloon” seemed to have been saved.

But that reprieve, according to Banksy, the street artist who created the work — and who organized the prank to destroy it — wasn’t planned. In a clip posted to YouTube on Wednesday, Banksy suggested that he had meant for the painting to be completely destroyed at the auction in London on Oct. 5, but that the plan had been foiled when the shredder unexpectedly jammed.

In the clip, called “Shred The Love,” a man is shown building the frame, his face hidden by a hoodie. “In rehearsals it worked every time,” a caption says. The video then shows a copy of “Girl With Balloon” being completely shredded as it slipped out of the frame.

The copy in the clip appears to have been printed on paper, whereas the “Girl With Balloon” sold at auction was spray-painted on canvas, a tougher material, which may explain why the shredder failed. Joanna Brooks, the director of JBPR, who answers media enquiries on behalf of Banksy, did not respond to phone calls or to an email asking whether the rehearsals had indeed been conducted on paper copies.

“It does look like paper coming out, but there is a chance it could be a fine linen,” said Danielle Howe, who works at John Jones, a London-based canvas supplier. But, she added, “It’s difficult to determine without looking at the work in person.”

Banksy’s prank caused shock and amusement, but it also led to a rash of conspiracy theories about Sotheby’s involvement. “Some people think the auction house were in on it, they weren’t,” Banksy said in an Instagram post on Thursday alerting people to the YouTube clip.

Alex Branczik, Sotheby’s head of contemporary art in Europe, also denied any collusion. In an interview with The Art Newspaper published on Wednesday, he said that Sotheby’s had asked Pest Control, Banksy’s official authentication body, if the gaudy frame could be removed before the auction.

“Pest Control said very clearly: The frame is integral to the artwork,” Mr. Branczik said.

He added that a “third-party conservator” had inspected the frame but had not noticed the shredder. “You address what you see — it was more like a sculpture,” Mr. Branczik said. The conservator did not take apart the frame, he added.

The buyer of the artwork has kept the piece. It is now called “Love Is in the Bin,” after Pest Control issued a new authentication certificate for the work.
Source: The NY Times 


Shredded Banksy Increases In Value

Just a quick mention, I am sure most have seen the shredded Banksy "Girl With Ballon" being shredded after selling this past Satruday for $1.4 million. It was actually so well publized I had decided not to post on it until I started seeing follow-up articles on the increase in values being reported. As appraisers, this type of unique publicity and interest should be examined by appraisers of fine art and analyzed properly, such as what type of premium or multiple and perhaps, how long might it last, or will the premium decrease somewhat over time. There are a lot of great appraiser discussion points on this sale and the potential impact on value.

The UK's Independent newspaper had an article stating " Banksy artwork 'doubles in value' after being shredded in front of stunned buyers at Sotheby's auction. click HERE to read that article.

The insider reports on the sale and the potential increase in value.

  • Banksy's "Girl With Balloon" shredded itself after being sold at auction Saturday for $1.4 million.
  • Some experts speculate it may be even more valuable now that it's been destroyed.
  • Others suspect the self-destruction was a stunt pulled with the participation of Sotheby's, the auction house.
  • A representative for Sotheby's told INSIDER it didn't know anything about the shredder. Banksy's studio told the auction house not to remove the painting from the frame, where the shredder was hidden.

On Saturday, Banksy's painting "Girl With Balloon" sold for $1.4 million at a Sotheby's auction, a record for the artist.

Then it slid into a shredder hidden in its frame and came out on the other side in tatters.

Now, it might be even more expensive.

"You could argue that the work is now more valuable," Alex Branczik, Sotheby's head of contemporary art in Europe, told The Art Newspaper. "It's certainly the first piece to be spontaneously shredded as an auction ends."

Banksy is a performance artist and street artist, known for using his work as a platform for slyly political and biting commentary. He's pulled stunts where he's sold art anonymously, then revealed himself as the artist, causing the value of those pieces to spike in the secondhand market.

Something similar may have just happened with "Girl With Balloon." Kevie Yang, a senior specialist at the auction house Phillips, told INSIDER that the painting is now unique in the annals of art history, and that the value of it will definitely change.

"This is a very special case, because nothing like this has ever happened in auction history," she said. "Everyone's talking about it. … There are a lot of people saying that the value of the work has already increased because of the incident."

Banksy's original works are seldom sold, since many of them are works of street art or performance art. The artist positions himself as a critic of consumer culture. He posted a video on Instagram saying he hid a shredder in the frame to destroy it in case it was ever sold at auction.

Did Sotheby's know about the shredder?
Several experts have speculated that Sotheby's may have been in on the stunt.

The banker auctioning off the painting was visibly unfazed, and sold the painting at the end of the lot, when it wouldn't distract from the other works being sold.

Furthermore, auction houses prepare detailed condition reports for potential buyers, and specialists told the Financial Times it would be difficult to imagine experts preparing those reports would miss a shredder in the frame. And because it was shredded neatly, it can potentially be repaired.

"The shredder in the frame — I don't know how well it was hidden. If you just look at the painting, look at the back, they would see something different," Yang told INSIDER.

Rosamund Chester, a press representative for Sotheby's, denied the auction house knew anything about the shredder. She told INSIDER that Banksy requested not to remove the painting from the frame, and Sotheby's agreed to his wishes.

"It is increasingly common in the contemporary art world for artists to deem their frames integral to the artwork, as was the case in this instance," Chester said. "The certificate from the artist's studio for the present work states that the frame is 'integral to the piece.' When Sotheby's asked the studio about removing the work from its frame during the cataloging process, we were expressly told not to remove the frame."

Chester said removing the frame would be tantamount to destroying the artwork.

"This is not unusual - consider Lucio Fontana's lacquer frames, or George Condo's frames that include labels on the back saying do not remove from frame," she said. "In many cases, if you remove the frame you violate the artist's wishes and destroy the artwork."

Chester declined to identify the consignor of the painting. In art auctions, the consignor is either the owner of the artwork who brings it to auction, or a proxy for the owner. Consignors sometimes make independent evaluations of paintings before selling them.

The person who purchased the painting has also remained anonymous. Since "Girl With Balloon" was shredded into ribbons, it's not clear if they'll want to keep it — though its shredding may have actually been the point of the work.

"We have talked with the successful purchaser, who was surprised by the story. We are in discussion about next steps," Chester said.
Source: Insider 


African Contemporary Art Market

Posting over the next few days will be sporadic, if at all as I wrap up some appraisal work and prepare for my son's wedding on Saturday. Then should be back on schedule the following week up until I head to NYC and the AAA conference at the end of the month. If you have not registered, time is running out. More info is on the AAA website, CLICK HERE to visit.

As appraisers we need to stay current with trends in the many different segments in the art market. We can do that in numerous ways, some through observing sales at auctions and fairs as well as watching trade publications. artnet news just published an interesting article on the strength of the African Contemporary art market and a review of the 1-54 fair in London. Take a few minutes to read and follow the link for additional content.

artnet news reports
Art collectors love to be ahead of the curve, especially when a market is “emerging.” African contemporary art is in demand but prices are still within the reach of even new collectors. In London, the sixth edition of the pioneering African art fair 1-54 attracted new and established collectors as well as curators from prestigious institutions such as LACMA, the Guggenheim, and Foundation Louis Vuitton. Celebrities drawn to the event included the actor Idris Elba.

Around 18,000 fairgoers flocked to Somerset House during Frieze week in the hope of discovering artists, some of whom might become market darlings, or even superstars. The Nigerian artist Ben Enwonwu, who showed at the fair in the past, saw his auction price soar when his so-called “African Mona Lisa” painting fetched $1.67 million at Bonhams in February.

Speaking at the fair, Othman Lazraq, the president of Morocco’s new museum of African contemporary art, MACAAL, and director of the city’s cultural nonprofit, Fondation Alliances, told artnet News that collectors should be buying because of passion. He acknowledges that it can be a sound investment, however. “People who bought African art a long time ago are really lucky because the market is now established,” he said. “African contemporary art is not a trend” he stressed. “It is here to stay.”

Lazraq, who is on Tate’s African art acquisition committee, comes from a family of collectors. When his father, the property mogul Alami Lazraq, began collecting contemporary African art 15 years ago, there were just a few galleries dealing in art from the continent, and none specializing entirely in contemporary African art. Today it is a different story. At the fair, 43 galleries from Africa, Europe and North America presented works by more than 130 artists based on all three continents and beyond.

Lazraq was acquiring work for MACAAL on the opening day of the fair, and picked up a 2017 painting by Joy Labinjo, a young British artist with Nigerian heritage, for around £7,000 (around $9,000) from Tiwani Contemporary—which he points out was one of the first galleries to show US artist Kerry James Marshall, who was in London last week for his show at David Zwirner.

The fair has grown with the market. Launched in 2013, 1-54 now has a Marrakech edition and is expanding in New York, relocating from Brooklyn to a venue in Manhattan’s West Village for its fifth anniversary in May 2019. It has also launched artists’ international careers. The British-Caribbean sculptor Zak Ové’s 2016 courtyard installation, Black and Blue: The Invisible Men and the Masque of Blackness sold from the fair for £300,000 ($391,000), and the UK-based Vigo Gallery was showing his work this year next to the most expensive work in the fair, a £1 million ($1.3 million) painting by Ibrahim El-Salahi, whose work is in the collections of MoMA, the Met, and the Tate. The Sudanese artist was presenting his first foray into sculpture in the courtyard this year, the three trees were a talking point of the fair just like Ové’s installation was two years ago. Editions of Ovés invisible men are now on show in San Francisco’s Civic Center Plaza and Yorkshire Sculpture Park in the North of England.
Source: artnet news 


Sotheby's Sued for $380 Million

 A bad day for Sotheby's. They were hit with a $380 million lawsuit by Russian billionaire Dmitry Rybolovelev.

Rybolovlev is involved with a Swiss art dealer over 38 works of art purchased over the past decade for $2 billion, and is claiming the dealer owes him $1 billion. It seems Sotheby's was involved in selling aroud 1/3 of the 38 works to the Swiss dealer who then sold them to Rybolovlev.

Authentication does not seem to be the issue with the works, rather Ryboloblev is claiming the Swiss dealer (Yves Bouvier) lied about what he paid for the works, increasing his margins and inflating the sales price.

Bloomberg reports on the suit.
The epic international legal drama that has pitted a Russian billionaire against a Swiss art entrepreneur took a new turn on Tuesday with Dmitry Rybolovlev slapping Sotheby’s auction house with a $380 million lawsuit in New York.

Rybolovlev, who sold two Russian fertilizer producers for almost $7.5 billion in 2010 and 2011, has been pursuing Yves Bouvier around the globe for several years, claiming the art dealer owes him more than $1 billion. Rybolovlev accused Bouvier of overcharging him on 38 artworks that he purchased for $2 billion over more than a decade.

Rybolovlev’s companies sued Sotheby’s Tuesday in Manhattan federal court, alleging that the auction house "materially assisted the largest art fraud in history."

Rybolovlev says Bouvier lied to him about how much it cost to purchase paintings and pocketed the difference. “Sotheby’s was the willing auction house that knowingly and intentionally made the fraud possible" because it knew how much Bouvier paid the sellers, according to the complaint.

Of the 38 works Rybolovlev bought from Bouvier, Sotheby’s had a hand in the sale of almost one-third of them to Bouvier, according to the complaint.

“Mr. Rybolovlev’s latest desperate lawsuit is entirely without merit," Sotheby’s said in a statement. “The false allegations that Mr. Rybolovlev is making are already being litigated in the Swiss courts, which is the appropriate venue for this case.”

Sotheby’s said it’ll ask the New York judge to throw out the lawsuit.

Daniel Walter Levy, Bouvier’s lawyer, said he couldn’t immediately comment on the new lawsuit.

More on Rybolovlev’s Fight in Europe

Sotheby’s and Bouvier jointly sued Rybolovlev in Geneva in 2017 to block the Russian’s planned lawsuit in the U.K. The auction house said it’ll pursue the Swiss case, where it’s seeking a declaration that it didn’t engage in any wrongdoing.

Rybolovlev’s lawyers have sought for months a broader airing of documents that Sotheby’s produced as part of legal proceedings related to the Rybolovlev-Bouvier feud in Monaco, Singapore and France. Those filings haven’t been made public. The New York lawsuit might allow Rybolovlev to use those documents.

Among the transactions that Sotheby’s was involved in, according to the new lawsuit, were a nude by Amedeo Modigliani bought by Rybolovlev for $118 million in 2011; Gustav Klimt’s “Wasserschlangen II" bought for $183.8 million in 2012; and Leonardo da Vinci’s “Salvator Mundi” bought for $127.5 million in 2013.

Rybolovlev sold the da Vinci for a record $450 million in 2017.

Klimt’s "Water Serpents II"Source: WikiArt.Org
Sotheby’s knew that Bouvier represented Rybolovlev, according to court papers. Sotheby’s has disputed that.

“It strategized to sell plaintiff’s art through Bouvier and approached Bouvier about new opportunities for plaintiffs,” Rybolovlev claimed in the complaint. “By brokering sales to Bouvier at certain prices, sending Bouvier emails designed to encourage plaintiffs to pay inflated prices, and misleadingly appraising works at inflated prices, Sotheby’s participated in Bouvier’s breach of his fiduciary duties to plaintiffs."

Bouvier has said that he wasn’t Rybolovlev’s agent, but bought the paintings on his own and resold them to the Russian businessman.

Sotheby’s shares slipped 0.8 percent to $47.98 at 1:46 p.m. in New York, extending this year’s decline to 7 percent.
Source: Bloomberg 


A Look at Wine Auctions

The NY Times recently published an interesting article on the current strengths of the wine market at auction. I know many appraisers are now appraising wine, and with the market strong there should be some solid opportunities for appraisers.  The article notes fall is one of the stronger seasons for wine auctions, and there is currently confidence in the market place.

The NY Times reports

A decade before the United States declared itself independent of Britain, the London auctioneer James Christie had his very first sale. The auction, held on Dec. 5, 1766, included a feather bed and pillow, 12 oblong dishes, a pair of candlesticks and a substantial section devoted to wine.

More than three dozen cases of Bordeaux — also known as claret — and Madeira made it on the block that day, making it one of the biggest features of the event.

That auction business eventually became Christie’s, now the global company owned by the French billionaire François Pinault.

“Wine has been there from the beginning,” said Richard Harvey, the head of wine sales for Bonhams, which is based in London and has branches worldwide. “It was one of those more everyday items when auctions were not as focused on fine art.”

For the next couple of centuries, wine auctions remained a London-centric activity, a reliable staple but not a focus of the overall business for the big houses, or much of a headline-grabber.

But beginning in the 1990s, wine auctions underwent two global shifts. The momentum first moved to the United States when New York legalized wine auctions in 1994.

“From that moment up until 2008, the North American wine buyer was the least price sensitive,” said Jamie Ritchie, the head of wine sales for Sotheby’s. And because auction houses charge a buyer’s premium on the hammer price, those are the buyers they are always seeking out.

New York’s day in the sun was short-lived, as it turns out. In Hong Kong, wine auctions began in 2008, and just two years later, after a deep recession in the West, a formerly nonexistent category became, for Sotheby’s, bigger than sales for Europe and North America combined.

These days you can attend live wine auctions in Beverly Hills, Calif.; London; New York; Paris; Chicago; Hong Kong and many other places around the world. (Internet-only auctions of wine are prevalent, too.)

Fall is traditionally the marquee season, with the best bottles on offer.

Last weekend, a two-day sale at Sotheby’s Hong Kong demonstrated the strength of the Asian market. The slate of more than 1,700 lots brought in $14.5 million, beating the high estimate of $13 million. Highlights included a 12-bottle case of Château Le Pin 1982 that sold for just over $206,000 — around $17,000 a bottle — and a lot of Château Cheval Blanc 2010 that brought $166,000.

At Christie’s London, the Oct. 10 sale includes a 12-bottle case of Domaine de la Romanée-Conti Romanée-Conti 1988, from the world’s most sought-after single wine producer, estimated to bring in more than $200,000. (Though it’s been usurped as a price leader, London is still a rich source of wine auctions.)

The geography of the live auction venues has expanded, but the geography of the lots has been more consistent. A typical high-end wine sale is largely French, dominated by bottles of Bordeaux and Burgundy in particular.

In 2017, for example, those regions each accounted for around 40 percent of Sotheby’s yearly totals, leaving only 20 percent for the rest of the world. That last sliver was made up primarily of the French regions of Rhône and Champagne; wines from the United States, Italy and Spain; and spirits.

“The nature of wines that make it to the secondary market are those that maintain value or increase in value over time, and it’s not as many you’d think,” Mr. Ritchie said. “People think we can lead the market, but we can’t. We reflect the market.”

Collectors like the track record of producers like Château Haut-Brion of Bordeaux, for instance, because they think the wine ages well and consistently, particularly in famously good vintages like 1990.

For centuries, Bordeaux was the main event in high-end sales, partly because the top labels are made in enough quantity to make a collectible market. But Burgundy, which is generally made by small producers, in relatively tiny amounts, has become a driving force largely because of interest from Asia.

“A general trend for Asia has been the shift from Bordeaux to Burgundy in recent years,” with producers like Domaine de la Romanée-Conti and Domaine Leroy “replacing Château Lafite Rothschild on many a Hong Kong restaurant dining table,” said Chris Munro, head of the Christie’s wine and spirits department for the Americas.


An auction of important Italian wines was held by the Grand Cru Committee of Italy during the 51st Vinitaly, an international wine fair, in April 2017.

CreditJin Yu/Xinhua, via Alamy
Which helps explain why just two magnums of Henri Jayer Richebourg 1985 went for more than $94,000 in November 2017 at Christie’s Hong Kong. (Magnums are equivalent to two regular bottles.)

Although Henri Jayer is a sought-after Burgundy name, another coveted label, Romanée-Conti, dominates the wine auction market so thoroughly at present that there is no comparison on the art side.

Sotheby’s New York is staging a sale on Oct. 13 that proves the point, offering the personal cellar of Robert Drouhin. He is part of the family that runs an acclaimed Burgundy wine producer, Maison Joseph Drouhin. But the contents are around 90 percent Romanée-Conti wines. It’s as if Jeff Koons were auctioning off dozens of Ai Weiwei works.

Estimates for the Drouhin cellar are predictably high — thousands of dollars a bottle — but in the context of Sotheby’s entire business, wine is small relatively potatoes. Often the entire sale totals are less than that of a single, non-record-breaking Impressionist painting.

Hence the search for new markets like Asia, as well as new types of bottles to sell. In the latter category, spirits, in particular whisky, have gone from zero to hero for the auction houses in the space of a few years.

“The growth of spirits is very new,” Mr. Munro said. “In the last six months, there’s been a surge in prices, especially in New York and especially for Macallan whiskies. And more to come on that in various locations, I think.”

Bonhams set a world record for whisky in May, when a bottle of Macallan Valerio Adami 1926 60-year-old went for $1.1 million in Hong Kong. The house now does dedicated whisky sales there and in Edinburgh.

“It used to be a niche activity in the U.K., but now the big interest is coming from mainland China,” Mr. Harvey said.

Collectors who have not exhausted their fall budgets on the myriad coming sales of art, furniture, antiques and other collectibles are advised that another bottle of the record-breaking Macallan will be up for sale on Wednesday at the Bonhams whisky auction in Edinburgh; it is estimated to again fetch around $1 million.

A small price to pay to be a part of the long history of bottles up for bid. Right?
Source: The NY Times