The seemingly unstoppable growth of the Chinese art and antiques market came to a halt as it shrank by almost a quarter during 2012 enabling the United States to resume its traditional place as the world’s biggest market, reveals a report published on March 14, at the opening of The European Fine Art Fair (TEFAF) in Maastricht.

The TEFAF Art Market Report 2013 - The Global Art Market with a focus on China and Brazil also shows that amid slowing growth and continuing uncertainty in the global economy, the worldwide market in art and antiques contracted by 7% to €43 billion in 2012. The report says that many art buyers are minimising risk by opting for the best-known artists at the top end of the market with Post-War and Contemporary Art performing strongly.

The report has been compiled by Dr Clare McAndrew, a cultural economist specialising in the fine and decorative art market and founder of Arts Economics. It has been commissioned by The European Fine Art Foundation, organisers of The European Fine Art Fair (TEFAF) , which opens to the public in the Dutch city of Maastricht on Friday (15 March) and continues until 24 March at the MECC (Maastricht Exhibition and Congress Centre). TEFAF Maastricht, the world’s leading event of its kind, is renowned for its commitment to excellence, expertise and elegance. It is the Fair that defines excellence in art.

In 2011 China became the world’s principal market for art and antiques for the first time with sales soaring to 30% of the global total but slipped back dramatically in 2012. The TEFAF Art Market Report says: “The Chinese art market began to decelerate for the first time in three years with aggregate sales values dropping by 24% to €10.6 billion, reverting to second place behind the US in terms of global market share. The main reasons for the deceleration in growth were both demand factors (including a slowdown in economic growth and continuing liquidity constraints) and a reduced amount of high quality, high priced works coming onto the market. Many art funds and other speculative investors also reduced their participation in the market during the year.”

The report has also undertaken the first-ever in-depth study of the art market in Brazil, one of the world’s key emerging economies. Sales in the Brazilian art market in 2012 were an estimated €455 million, about 1% of the global total. Brazil’s principal significance has been through the buying power of its growing number of wealthy collectors. But restrictive tax and import regulations remain a major stumbling block to the international development of the Brazilian art market.

The principal findings of the report are:

■ Slowing economic growth and continuing uncertainty in the global economy filtered down to the art market in 2012 with global sales contracting by 7% from €46.4 to €43 billion.

■ A key factor in the decline was a slowdown in the Chinese market. Auction sales in China, the main engine of growth, dropped by 30% in 2012.

■ However the decline in China was counterbalanced by an increase of 5% in US sales figures to €14.2 billion.

■ The global reshuffle of art market share continued in 2012 with the US regaining its premier position with 33% (up 4% on 2011) while China dropped to 25% (down 5%). The United Kingdom remained third with 23% (up 1%) .

■ Economic and political uncertainties have produced volatility in many asset markets with a flight to safe blue-chip stocks and low risk assets. A similar picture has emerged for art with the strongest performances recorded by well-known artists at the top end of the market.

■ Post-War and Contemporary Art was the largest fine art sector of the market with a 43% share by value. It performed strongly, increasing auction sales by 5% to almost €4.5 billion, its highest ever recorded level.

■ The Modern Art sector was the second largest with a 30% share of the fine art auction market but, after peaking at €3.8 billion in 2011, auction sales dropped by 17% to €3.2 billion in 2012.

■ Sales in the private retail and dealer sector dropped by 4% to an estimated total of €22.2 billion. Like auctions, segments of the market fared differently with the lower end of the market recording the weakest performance.

■ The volume of transactions in the global art market in 2012 decreased by just under 4% to 35.5 million. This was down by nearly 30% on the pre-recession boom year of 2007.

Dr McAndrew will present the findings of her report at the second TEFAF Art Symposium on Friday 15 March. The 2013 event entitled Rising stars in the art world. Emerging markets and top performing artists will take place from 10.00 to 11.45 hrs in room 2.1 of the MECC (Maastricht Exhibition and Congress Centre). For more information and registration please see www.tefafartnews.com .

Copies of the report at €20 each excluding postage, can be ordered through the TEFAF website www.tefaf.com.