The Chinese mainland auction houses are betting big on the contemporary art over the coming month. "It is for the first time my company gives such a great focus on contemporary art," said Kou Qin, vice-general-manager of China Guardian Auctions Co Ltd, allegedly the largest art auctioneer in the country. "There might be a bigger risk than usual, but we believe the market to be going that way being vanguard."

The mainland art market, which has been feverish since the autumn of 2003, initially attracted collectors focused on the classics.

Ancient paintings and calligraphies in the royal collection of the Qing Dynasty (1644-1911) were the first love of collectors. In 2002, an ink painting of birds by 12th-century Emperor Huizong (reigned 1101-25) which used to be collected by the Qing royal family, was sold for 23 million yuan (US$2.88 million) at a Beijing auction.

This love for ancient art cooled because of the limited number of fine, antique art and also the problems related to authenticity. Since the autumn of 2003, collectors have been pursuing 20th-century Chinese art, including oil and ink paintings.

The buyers, many of whom speculated in art as they did earlier with the stock market, pushed up the prices of works by artists, such as Lu Yanshao (1909-93) and Wu Guanzhong, now 88, to an incredibly high level over the following two years.

In November last year, at the peak of art market madness, a colour ink painting by Wu depicting 40 parrots on trees sold for 30 million yuan (US$3.8 million), setting a world record for any piece of contemporary Chinese art.

It was even more expensive than the work of Emperor Huizong, deemed as one of the greatest artists in the Chinese history.

By the end of 2005, there were concerns the art market bubble might be bursting. Since then, sales of 20th-century Chinese art at some major auction houses have tailed off. In one auction in Beijing in December 2005, only four of the dozens of lots were successfully sold.

In the spring auctions of 2006, few new records were created and auction companies were putting their stakes on the safety of ceramics, which have always had a stable price level. Meanwhile the hunt was on to find new art interest of collectors. It didn't take long.

In March this year an oil painting by young artist Zhang Xiaogang was auctioned for US$977,200 at a Sotheby's auction in New York more than twice the estimated price. "I can still remember Zhang's another painting, of roughly the same size, sold only for 20,000 yuan (US$2,500) at my company's first auction in 1994," Kou at the China Guardian told China Daily.

"We began to believe that contemporary Chinese art is having a good market in the West," he said. "That will largely reduce the risks of domestic investment in contemporary art."

Kou's company will host an auction titled "20 Years of Contemporary Chinese Art" during its autumn auctions next week. It involves dozens of most established artists, who have rose to stardom since the debut of contemporary art in the "1985 New Wave" cultural movement from 1985 to 1989.

The landmark artwork of the movement, "Dialogue" by Xiao Lu, will go under the hammer for between US$262,500 and US$387,500.

In the spirit of true modern artist, Xiao fired two bullets into her installation at the "China Avant-Garde" exhibition at the National Art Museum of China in February 1989, and shook up the Chinese art world.

Vanguard artists who attract higher bidders than Xiao, such as Wang Guangyi and Zhang Xiaogang, are expected to be in demand. Zhang's small-sized oil painting "Love of Generations" is tipped to sell between 2.2 and 3.2 million yuan (US$282,100-410,300), while Wang's 1985 oil painting "North Pole Amalgamation No 25" is estimated at between 750,000 and 850,000 yuan (US$93,800-106,000).

"We want to make art history at our contemporary art auction," said Kou. "We highlight several artists; give them more theoretical backups than at present and hopefully help the market sustain its development."

Ferocious competition

Kou's major competitor, the Beijing Poly Art Auction Co Ltd, has put an even larger stake on contemporary art. More than half of its 1,000 lots at the auction will be contemporary art pieces. The Poly auction also includes works by Wang, Zhang and other popular artists, such as Yue Minjun and Zeng Fanzhi. It is also devoted to promoting younger artists who have already been established in the art circle but still not well known among collectors. These include Yin Chaoyang and Zhang Jian.

But the spotlight of the auction will be cast on the "Newly Displaced Population," an oil painting by Liu Xiaodong.

A professor at the Central Academy of Fine Arts in Beijing, Liu spent three summer vacations in the Three Gorges reaches before painting those people moving away for the power-generating project in 2004.

The super-sized painting, measuring 300cmx1,000 cm, depicts young villagers in groups staring puzzled at the Yangtze River. It has an estimated price between 8 and 10 million yuan (US$1-1.25 million).

Ma Zhefei, managing director of the company, hoped the piece would create a new world record in contemporary Chinese art.

Adding to the ferocity of competitions in the market will be the Christie's autumn auction of Asian Contemporary Art in Hong Kong on November 26.

In conjunction with the 20th anniversary of Christie's Hong Kong in 2006, the auction is to bring together "an array of superb works by some of the most celebrated and promising contemporary Chinese, South Korean, Japanese and Indian artists," said Dick Lee, its spokesman in Hong Kong.

Taking the centre stage at the Christie's auction will still be the internationally acclaimed artists Zhang Xiaogang, Cai Guoqiang, Yue Minjun and Wang Guangyi.

Among them, Cai will present his "Ascending Dragon: Project for Extraterrestrials No 2," which is a preliminary sketch for a large-scale blast project carried out in 1989 for a French exhibition. It is regarded as a valuable example of the sketches produced by Cai for his huge gunpowder blast projects.

Another work of Cai failed to be sold at a Beijing auction at the beginning of the century, in spite of the low price of no more than 100,000 yuan (US$12,000). This time, with a bottom price of 2 million HK dollars (US$256,400), the sketch is expected to attract buyers from Beijing to Hong Kong.

(China Daily November 17, 2006)