Finding the right niche and the right buyer

Chinese buyers have been the bright spots in art markets across Asia and Europe in recent times, especially with the big-ticket purchases of highly priced, ancient Chinese artworks.

There are several reasons behind the artwork acquisition frenzy in China. For starters, many believe that making art purchases is in line with China's emergence as a global economic power.

The moribund domestic art market has also prompted many Chinese buyers to scout for suitable acquisitions in overseas markets. That represents a stark change from a decade ago, when Chinese buyers, especially from the mainland, were not active in global auctions. They used to be mostly from Taiwan and Hong Kong.

Although there were no buyers, there was still great demand for old Chinese artwork. The $27.7 million paid by London dealer Giuseppe Eskenazi in 2005 at a Christie's auction in London for a rare Yuan Dynasty (1271-1368) blue and white jar was the highest price paid for an Asian artwork at that time. The jar depicts a battle scene between two states taken from a form of popular opera known as zaju.

The bidding process for this artwork was rather unique in that it involved a Taiwanese customer. Although he was unable to win the bid, it was the first instance of a Chinese buyer competing in a global auction for high-end artwork.

Although Chinese dealers used to be keen participants at global auctions, they were never major buyers until then, because they did not have the required funds, say art experts.

Because most of the bids had to be made in dollars, and taking into account the then exchange rates, many Chinese buyers preferred to be spectators, rather than participants.

Eight years ago, there was a popular saying in the Chinese art community. The trading hub for Chinese antiques, including all sorts of ancient porcelain, is Europe, while for Chinese paintings it is the United States.

These are also the two categories that most of the current Chinese collectors are interested in. Most of these collections are porcelain and paintings that were moved out of the Forbidden City for historical reasons many years ago.

Because of the easy currency conversion and entry-exit processes in Hong Kong, many art transactions were gradually transferred from Europe and the US to Hong Kong. This saw more Chinese people getting into the art business.