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As shipping costs rise, galleries get creative

‘Shipping has become a nightmare,’ says Mihai Nicodim, owner of Nicodim Gallery (Los Angeles and New York City). ‘It almost doubled. When the pandemic hit, we were getting quotes that quadrupled overnight.’ Talk to any dealer right now about shipping costs and you are likely to get the same reaction.

Dealers responding to a survey for the Art Basel and UBS Art Market Report 2023 also noted ‘that shipping costs in particular had rocketed in 2022, with some commenting that their expenditure in this area alone had increased by 20% to 40% in the space of 1 year.’

The causes are plain. Supply chains that were disrupted by the pandemic, marked by shortages in materials and labor, were only further strained when Russia launched a full-scale invasion of Ukraine in February 2022. And costs that go up don’t tend to fall again.

While it’s a very current subject, says Derrick Hilbertz, Vice President, Operations at art shipper Dietl (about half of whose business comes from art galleries), it ‘has been a hot topic for 30 years.’ He acknowledges that fuel costs have risen recently and that there has even been a shortage of trucks. ‘Wood products in general went through the roof during the pandemic,’ he adds, so the crates that artworks get packed in went up in price. Hilbertz admits that shipping costs are ‘a bummer to have to talk about’ when people would rather be discussing art.

Galleries are in the business of moving works all the time: from artists’ studios to the gallery or the gallery’s storage space; from studio or gallery to art fairs (and sometimes back); and from the gallery (or storage or fair) to collectors. Nicodim says that in a pre-pandemic year, shipping could already account for as much as 20% of his expenses. Even before costs rose, dealers had become very canny about ways to mitigate this considerable cost.

In our on-demand world, and when galleries may wish to show the most desired work possible, shipping by air is the quickest, but also the priciest. Dealers save considerably by sending works by ocean freight, but it is not a perfect solution.

‘We started using sea shipment, and it has not been too bad,’ says Simon Wang, the founder of Antenna Space (Shanghai). He can’t move everything that way, he says, because it is much slower, so the works have to be prepared months in advance. ‘Some of our artists are quite young and they don't finish works till very late,’ he says.

For galleries showing historical material, ocean shipping is more viable, but even then, points out Penny Pilkington, co-owner of P.P.O.W (New York City), ‘it’s in a crate on the high seas for two months, rather than in the gallery, where you can work with it.’

The simplest solution, says P.P.O.W Registrar Jennifer Brennan, is long-term planning. ‘The calendar year is our best friend,’ she says. ‘As much as we can, we plan in advance, whether it’s arranging manpower, sourcing materials, reusing a crate from one fair to the next, or coordinating with artists so that we know what kind of work to anticipate and how we can be most clever in supporting that.’

‘Galleries can be really smart when they don’t add to shipments at the last minute,’ acknowledges Hilbertz. ‘They plan things out in advance, consolidate their packing, and thus keep operational costs down.’

Ocean shipping has the advantage of being more environmentally sound, a plus in a context of increased pressures to reduce carbon footprints. The Gallery Climate Coalition, an international community of arts organizations, aims to facilitate the sector reducing its carbon emissions by a minimum of 50% by 2030, as well as promoting zero waste.

Museums are hewing to the same goal. All loans for the 2023 exhibition ‘Isa Genzken: 75/75’ at Berlin’s Neue Nationalgalerie came from European nations and were transported by land. The museum posted a sign in the exhibition space to that effect, says Lisa Botti, Assistant Curator at the Neue Nationalgalerie.

As much as they can, galleries reuse crates. It’s more environmentally sound and saves on materials. But, as P.P.O.W’s Brennan points out, the wood can’t be used indefinitely. Moreover, reusing packing materials is fine if a gallery is shipping a work to a fair, where only gallery staff or art handlers will see it. A collector who has invested in a work has higher expectations in terms of presentation. There are also costs associated with storing a crate and with the time required to pack it like a jigsaw puzzle, says Pilkington.

Hilbertz points out that Delaware National Art Company, also owned by Fritz Dietl, has developed the ‘Earthcrate’, a recyclable crate made from paper products that can literally be cut apart and left at the curb. He acknowledges that even though it’s a bit cheaper than a standard crate, dealers may require a body of evidence that the crate is as safe and effective, ‘and that takes time.’

Sometimes, dealers get far more creative than reusing crates. Pilkington says that while P.P.O.W’s shipping costs remain relatively low because many of its artists are in New York, the gallery has discussed the possibility of temporarily renting a local studio and apartment for one artist who lives abroad to create work for a show, avoiding the cost of overseas shipping.

New companies have popped up to try to undercut the competition; ‘they’re offering very competitive rates,’ says Nicodim. As for Brennan, she feels that many of the new companies don not exactly inspire confidence.

Wherever possible, dealers bring operations in-house. Nicodim was able to get warehouse space next door to his Los Angeles gallery, where his staff builds crates and packs them. With the affordable real estate there, he says, the operation pays for itself.

Collectors, likewise facing higher costs to ship the artworks they buy, are moderating their expectations, says Nicodim. One collector, who used to request that a work be shipped within a month, is now content to consolidate purchases from multiple galleries into shipments every 6 months. Nicodim sometimes houses works from other galleries that are going to the same buyer. ‘I’m getting a lot of emails from other New York galleries, asking if I can hold on to works for them,’ he says.

Amid all the challenges, Hilbertz notes some bright spots. ‘The art shipping industry is pretty radically open to conversation with our clients,’ he says. ‘We are part of their ecosystem, and vice versa.’ Another reason that galleries have spent more on shipping, says the man who counts the crates, is that they’ve been shipping more work. ‘The explosion in the art world has been phenomenal over the last year,’ he observes. ‘They’re moving more work, and it is selling.’