Anthony Smith – The Aboriginal Art market in Australia: a personal perspective.

Much has been written about the Australian Aboriginal art market as about Australian Aboriginal art itself, which when you think about it, is really quite strange.Why is it that the marketing of these artworks garners as much interest as the artworks themselves, and in some respects, more ?

These are my views regarding the marketing of Aboriginal art.

Now, I must firstly state my position.I deal in Australian Aboriginal work.Not exclusively, but it is an area that I find to be of amazing interest to me.This wasn’t always the case. In fact, in the past I found that Aboriginal art did absolutely nothing for me and I was as dismissive of it and its place in the art world as its worst critic. I have more recently been pondering as to why I took such a dismissive view of it and what, more recently, had changed my mind to lead to such a dramatic appreciation of it as a contemporary art movement as to now be a very strong supporter of it.

Looking back on my 30 odd years in the art business, Aboriginal art was always available and accessible, but in the early years, mostly through galleries that were more like warehouses. This, on the whole* in Australia, sadly hasn’t changed to the extent one would have expected, considering the academic as well as worldwide interest in the works and the prices they command. (*that said, there are some fine galleries who respect, research and handle the artworks as one would expect).

In Australia now, there are still many “galleries” selling Aboriginal art as if the paintings were towels or items of hardware. You walk into these galleries that, nine times out of ten, are poorly lit, have no feeling for the aesthetic or the spirituality of what they are showing and selling. The artworks are often piled one on top of the other and are handled as one sees carpet traders handling their wares in the middle east. There is no respect shown for the pieces or for what they represent. This is one aspect of the reason why I never previously took the artwork seriously: if the majority of the galleries handling it didn’t respect it, then why should or would I ?

This then leads to the next type of selling that I feel also devalues the art: the week long or weekend sales in Church halls, town halls or similar.Huge and colourful advertising usually precedes these sales with the headlines Bargain Aboriginal Art or similar. The work is being sold as a commodity and for sale at “huge discounts to retail gallery prices“.This never inspires confidence, well, not from my perspective, and yet you will always see a stream of buyers descend on these venues and walk away with their discounted treasure.

Sadly, what these people have purchased is neither discounted nor a treasure, but at retail prices for lesser work of a mid range artist or worse, the work of a person who is really only painting as there is no other source of income. This then devalues the art as a whole.

Back in the mid 90′s there also was controversy as to whether Aboriginal artwork purchased directly from the artists was a legitimate purchase or whether such purchases should be only made through the artist’s community or co-operative. This led to long discussions with even the large auction rooms becoming involved to such an extent that they became quite discriminatory in what they would accept and from whom they would accept work to be consigned for auction.

THE DAMAGE TOOK SOME YEARS TO REPAIR

The fact was that there were as many very ethical dealers as there were unethical and thus all were painted with the same brush and the market was further tarnished.The reaction to this public discussion led to a great outpouring of opinions, some well constructed whilst others were ill-informed at best. But the fact was that it further damaged what was a relatively fragile market and this damage took some years to repair.

Over a period of some years, the Aboriginal art market started to rebuild itself. Stagnating sales and a distrust of the market in general had led to a substantial decline in prices to such an extent that there were bargains to be had that even the most aprehensive buyer could see and appreciate.

It was during this period that my eyes were suddenly opened to some of the best Aboriginal art. I visited Public Galleries, commercial galleries and spoke with many collectors…and it was a revelation. These works were complex, beautifully constructed and with either very subtle colours or other canvases as bright as a summers day with vivid colour. More importantly, they had meaning. A hidden spirituality. A link to another time.

Also, at this time, buying for investment by Self Managed Superannuation Funds ( a retirement savings program set up by a previous government for those who wanted to self-manage their retirement savings) started to have a positive impact on the sales of Aboriginal art and slowly but surely, it started to rebuild on a firm footing with strong sales locally as well as internationally.

The auction houses seeing that their previous involvement had at best a negative impact on the market and seeing too that they could increase their own income by again openly selling Aboriginal artwork without qualifying where they had originally been purchased, embraced the stronger market for Aboriginal art by initially including some artworks in Fine Art sales and then by mounting “Specialist” sales devoted exclusively to quality artwork by major deceased as well as up and coming artists. The prices moved higher and higher and world records were achieved.

In 2007, Emily Kame Kngwarreye, a living artist at the time, set a new record with one of her paintings selling at auction for $1,056,000 AUD then in July of 2007 another record was set with the sale of a Clifford Possum Tjapaltjarri for in excess of $2 million AUD.The market was booming again and investors as well as collectors started to look at Aboriginal art again and in a much more serious way than they had done so previously.

All was going well. The artists communities were receiving strong orders for works as well as individual artists who were being approached too by private dealers. Everyone was getting involved in the market. SMSF’s were strong supporters of the market, but were buying more with their eye on the investment potential of a piece rather than considering the aesthetics or deeper meaning imbedded in the pieces.

But then, just as the market was recovering, the Arts Minister in Australia at the time, Peter Garrett (of some prior fame as the lead singer of Midnight Oil and even greater fame, or more correctly, infamy, as the responsible minister for a number of less than successful, some would say disastrous, policies) decided that the market needed to be regulated and that the artists themselves should benefit from an Artists Resale Royalty scheme. In theory, a good and admirable policy, however, in practice, anything but.

The market slowed somewhat to digest this surcharge on re-sales and overall decided that it wasn’t unfair and could be accommodated.  The fact that the body running the scheme cost more to administer, $2.5 million pa, than the scheme itself has delivered to all artists, some $600,000, has proven to be another issue of economic management by this government that will no doubt blow up prior to the next election.

However, this wasn’t the blow that caused the real damage to the market.In 2010, a review done on the investments of SMSF had suggested that investments in “exotic” items such as art and collectables be stopped. The government at the time dismissed this and all seemed well. SMSF’s continued to invest in Aboriginal art as well as other collectables and their investments proved sound. However, this year, the Australian Gillard government decided to re-visit this review (the Cooper review) for whatever reason and this has led to a change of heart.

The government has now embraced the policy of banning SMSF’s from investing in collectibles and personal-use assets. This includes art, jewellery, antiques etc. Existing SMSF collectibles have to be sold by 2020. The Aboriginal art market in Australia has suffered because of this action. Auction houses complain that there are few buyers. Dealers too, particularly those with good quality stock, have seen their markets dry up. Yet, the weekend traders and low end galleries still do reasonably well.

ART WORKS HAVE PERFORMED WELL

Some SMSF’s have already sold out. A large collection of Aboriginal work held in a SMSF by a major gallery owner in Melbourne was sold at auction recently at what can only be described as disappointing prices. Other SMSF members as well as many galleries and dealers are just hoping for a change of government and a change of heart on this review as previously, the artworks have performed well in an investment sense.Whist all this is going on in Australia, there is still strong demand for quality pieces overseas where now, many of the best pieces are being sent. A loss to Australia.

Another sad aspect of all of this is that many of the artists painting today are elderly. Most are not concerned or interested in the financial aspects of what they do, but it is having an impact on them and their communities. This, in my view, is the state of the Aboriginal art market in Australia today. It can only get better !

Best wishes,

Anthony