Builders were initially faced with what looked like a looming...

Builders were initially faced with what looked like a looming recession, well before increasing supply cost were evident. As a result they signed jobs where possible, sometimes at close to break even ("break even" based on the then current and historical supply costs).
The double whammy was that workload and costs increased well last break even. Keeping in mind that a builder is contracted to supply materials at todays price, often a year or more later. The perfect storm erupted. This contract is bound by the building contracts act and thus provides very little scope to recoup these losses, without breach of contract.
At the time very few people if anyone, were predicting the supply crunch cost escalations. Economists, bankers, politicians, none of them. What chance does a builder have of foreseeing this?
Even once the cost increases were well underway, and continue to be. They are so far past anything ever seen before that most expect the peak to be near. Maybe it is maybe it isn't.
For a builder to simply stop signing contracts for an undefined period is effectively closing the door on the business.
The root of this problem is not just the cost escalation of materials. It is that the current contracts do not allow the current cost of materials to be paid by the client.