Dealer Spotlight: Taiwan [Mainland Demand for Chinese Antiquities]

Artphaire (Online), April 16, 2014.

How hot is the art market in China? Ask a dealer from Taiwan.

By Jason Edward Kaufman

The demand for antique and modern Chinese art is so strong that a dealer can acquire works in the West and flip them in Mainland Chinese auctions invariably for a profit. This is the strategy of Hai-sheng Chou, a second-generation dealer in Taipei who has developed a flourishing West-East trade. He searches smaller auctions in Europe and the U.S., acquires Chinese works, and immediately sells them at auctions in Mainland China.

ArtPHaire spoke with Chou about this business model and whether or not it is sustainable.

How did you become an art dealer?

My father was an antique dealer. I worked part-time for him in high school and came to love it. I went to graduate school in art history at the University of Kansas, and after my father died I partnered with a friend on an antique shop for a year, then became an editor first at Lions Art Magazine and then for Chinese Art News Magazine. After seven years in publishing I quit and started dealing again.

What was it like when you started?

My specialty is Chinese painting and calligraphy, but in the late 1990s and early 2000s the market for such works was not good, so I tried to make a living selling ceramics, carved jades, and other objects. Over the Internet I found material in America. Americans purchased things 40 or 50 years ago and now they were selling on ebay. I bid around $100 to $3,000 per item and over a year and a half I spent $150,000 using money I got from mortgaging my apartment. I was not selling, but building an inventory of 80 to 100 pieces. Two years later I realized that all my works were fakes. Not one single piece was old.

What a calamity! How did you recover?

In 2002 Chinese painting and calligraphy became very hot.  Another dealer asked if I had any paintings and I sold him my father’s inventory to cover the loss. I threw all the fakes in the basement. The market stayed hot until the 2008 financial crash, and during six years I made money.

When did you first develop the strategy of buying in the West and selling in Mainland China? What made it possible?

The big year was 2004 because in Mainland China they wanted to buy anything. The most influential factor was that they became rich! In Spring 2004 I took 10 pieces to Hua Chen auction house in Beijing. The final price was five times higher than the estimate. One season I made nearly $200,000. Now I only have business with dealers and auction houses. I do not have collectors partly because I do not have a shop. 

Before 2007 it was easy to find material in Taiwan. Since then collectors and dealers prefer to sell directly to China. They can skip me and make business directly with Chinese auctions, so it has been difficult to find things in Asia. A Canadian-Chinese stockbroker and collector friend suggested that I look for material in the U.S. instead. He said, “You can speak English. Why not go to America?” He was right. I began contact with auctions in Europe and the U.S., mostly on the East coast. Not the big auctions, because the estimates were too high for me at that time. Smaller auctions with $200 to $300 estimates were much more attractive.

My research is now only via the Internet. If I am spending $2,000 or less it’s not worth it to fly to see the piece. I judge its quality by the reproductions online and the information provided. You have to take the risks.

What material do you specialize in?

I sell mostly paintings from the first half of the 20thcentury. They are easier to locate and purchase than older works. I also buy decorative objects in America. There are more porcelains, sculptures, jade carvings and ivories available than paintings and calligraphy. They are easier for foreigners to appreciate.

My sources in the U.S. are mainly on the East Coast and in California. I also buy in England where there were major dealers in Chinese art, such as Spink & Son, and in Paris. Some works left China during the Opium Wars or the Boxer Rebellion, when officers took things from the Forbidden City. These are the most-wanted targets for Chinese collectors. We can tell from the craftsmanship which objects were imperial.

Can you give a few examples of works you discovered in the West that sold for a big price in China?

I bought a carved agate on a painted-ivory stand. The subject is Li Bai drinking wine, and it’s only a few inches tall, but made in the 18thcentury for the Qianlong Emperor. I purchased it at a small English auction house in 2011 for around 300 pounds. I placed a bid of up to 1,000 pounds, but I was the only bidder so I got it for the reserve plus commission. Within a year I sold it at Chengxuan auction in Beijing for around $80,000.

I bought an album painted in the 1980s by five or six artists – Lu Yan-shao, Xia Zi-liu and others — as a gift to a Chinese professor in New Haven. I bought it at Skinner in Boston around 2011 and paid $30,000. A year later I sold it at China Guardian Auctions in Hong Kong for something like $125,000.

Do other dealers do the same kind of business?

Of course! Dealers from Mainland China also are doing this. It used to be only Taiwanese and Hong Kong dealers, but the market got so high that dealers from Beijing and Shanghai can afford to come to the U.S. to buy inventory. I don’t mind the competition.

Who are the buyers in Mainland China?

Those who want to make money! They buy mostly for investment. There are lots of dealers. They bid against each other in hope to sell it the next season. From 2003 to 2007 I saw re-sales easily double in a short period of time.

How has the market changed since you began, and what is your outlook for this market?

It’s a little slow right now. Prices went too high and it’s not so profitable. Ten years ago with $50,000 you could get involved in the market. Nowadays you need $5 million. There’s not much cash to support the market. There are still the same people and energy, but they hesitate to pay so much. They want an opportunity – high quality at low price. It’s been a bit slow, but this is temporary. It will go higher later. I’m confident.

Jason Edward Kaufman //

This article appeared on Artphaire (Online), April 16, 2014.


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Jason Edward Kaufman is an art historian and critic with expertise in museums and the international art world.

A complete list of past articles is available here.


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