docker compose build is not passing build args defined in compose file

Test Dockerfile

FROM alpine:latest
RUN env
ARG buildno
RUN env

RUN echo "Buildno: ${buildno}"

ENV buildno=${buildno}
RUN echo "Buildno: ${buildno}"

Sample docker-compose.yml

version: "3.9"
services:
  db:
    build:
      context: .
      args:
        buildno: 1

docker compose build does not recognize that I passed an argument

❯ docker compose build --progress=plain --no-cache
#1 [internal] load build definition from Dockerfile
#1 sha256:992c28c35229487c58b557ccebcbb8772478b17e7152af31cc17ff8a2dd5700b
#1 transferring dockerfile: 32B done
#1 DONE 0.0s

#2 [internal] load .dockerignore
#2 sha256:3fc1d3b238273b1e933207500d598f0e582aa027e6d4fc4ad6cf4cfffc7cb84c
#2 transferring context: 2B done
#2 DONE 0.0s

#3 [internal] load metadata for docker.io/library/alpine:latest
#3 sha256:d4fb25f5b5c00defc20ce26f2efc4e288de8834ed5aa59dff877b495ba88fda6
#3 DONE 22.3s

#4 [1/5] FROM docker.io/library/alpine:latest@sha256:69e70a79f2d41ab5d637de98c1e0b055206ba40a8145e7bddb55ccc04e13cf8f
#4 sha256:4377fd7ee933f9abee380281596860b3799a6ae79feb340aabca95266dfa3c7a
#4 CACHED

#5 [2/5] RUN env
#5 sha256:be6eea4298c6fb361d86faf696bfc838c149cb5c271dd16ea1a299692826974c
#5 0.268 SHLVL=1
#5 0.268 HOME=/root
#5 0.268 PATH=/usr/local/sbin:/usr/local/bin:/usr/sbin:/usr/bin:/sbin:/bin
#5 0.268 PWD=/
#5 DONE 0.3s

#6 [3/5] RUN env
#6 sha256:23b8c1e3fd3690c128e2a55ef62dfaf23b3cfa0a453b0153a5f2e49f2e4e0f60
#6 0.390 SHLVL=1
#6 0.390 HOME=/root
#6 0.390 PATH=/usr/local/sbin:/usr/local/bin:/usr/sbin:/usr/bin:/sbin:/bin
#6 0.390 PWD=/
#6 DONE 0.4s

#7 [4/5] RUN echo "Buildno: ${buildno}"
#7 sha256:3c016f4ac1f74bb8c620d650a64430c97db000e68f2e90ba7b57a1fabd8e0429
#7 0.480 Buildno: 
#7 DONE 0.5s

#8 [5/5] RUN echo "Buildno: "
#8 sha256:126fb7196a18d7c37b4bd6d3047bd1f8b85194e8f51236be3e2feeccb1618448
#8 0.501 Buildno: 
#8 DONE 0.5s

#9 exporting to image
#9 sha256:e8c613e07b0b7ff33893b694f7759a10d42e180f2b4dc349fb57dc6b71dcab00
#9 exporting layers 0.1s done
#9 writing image sha256:ea5a8f5ae5de47d0a24a1677e9b7e53cf260baa118237c94c82eebec4e4a6190 done
#9 naming to docker.io/library/dockercomposetest_db done
#9 DONE 0.1s

If I pass the value via the cli --build-arg though it is picked up, so this appears to be an issue with docker compose?

❯ docker compose build --progress=plain --no-cache --build-arg buildno=2
#1 [internal] load build definition from Dockerfile
#1 sha256:5a5f2608ee72730359e95a730d180af322b44d3bcdb6ea91e8992d017ec248f5
#1 transferring dockerfile: 32B done
#1 DONE 0.0s

#2 [internal] load .dockerignore
#2 sha256:abba8545a73f90b4698337406c49e4d0fa6966c6e689ac32f7805a241632ec40
#2 transferring context: 2B done
#2 DONE 0.0s

#3 [internal] load metadata for docker.io/library/alpine:latest
#3 sha256:d4fb25f5b5c00defc20ce26f2efc4e288de8834ed5aa59dff877b495ba88fda6
#3 DONE 10.5s

#4 [1/5] FROM docker.io/library/alpine:latest@sha256:69e70a79f2d41ab5d637de98c1e0b055206ba40a8145e7bddb55ccc04e13cf8f
#4 sha256:4377fd7ee933f9abee380281596860b3799a6ae79feb340aabca95266dfa3c7a
#4 CACHED

#5 [2/5] RUN env
#5 sha256:be6eea4298c6fb361d86faf696bfc838c149cb5c271dd16ea1a299692826974c
#5 0.264 SHLVL=1
#5 0.264 HOME=/root
#5 0.264 PATH=/usr/local/sbin:/usr/local/bin:/usr/sbin:/usr/bin:/sbin:/bin
#5 0.264 PWD=/
#5 DONE 0.3s

#6 [3/5] RUN env
#6 sha256:8c552c6113c92a1f6d4e4489d771c4b7ae89884edaa0de36e05aa1f1dc3b91de
#6 0.430 SHLVL=1
#6 0.430 HOME=/root
#6 0.430 buildno=2
#6 0.430 PATH=/usr/local/sbin:/usr/local/bin:/usr/sbin:/usr/bin:/sbin:/bin
#6 0.430 PWD=/
#6 DONE 0.5s

#7 [4/5] RUN echo "Buildno: 2"
#7 sha256:143f19962211b5fc0d418112ffb5d7cd6c8e2601dc1ee57012c15ce95ecb6ddc
#7 0.457 Buildno: 2
#7 DONE 0.5s

#8 [5/5] RUN echo "Buildno: 2"
#8 sha256:18d66f93e7671b75c99f6b9811fb2d17995ae9327d9691c12c0d11983cf232d7
#8 0.441 Buildno: 2
#8 DONE 0.5s

#9 exporting to image
#9 sha256:e8c613e07b0b7ff33893b694f7759a10d42e180f2b4dc349fb57dc6b71dcab00
#9 exporting layers 0.1s done
#9 writing image sha256:550109791ad859f682ac8686795400d612354a539afd55a9ad268f603dcce3f0 done
#9 naming to docker.io/library/dockercomposetest_db done
#9 DONE 0.1s

The buildno value shows up as expected after being defined on line 3 and appears in the environment variable as it should. Any thoughts? I get the same results using my windows client as my WSL2 one.