mongo client can parse MongoDB connection string URI, so instead of specifying all connection parameters separately you may pass single connection string URI.
In your case you’re trying to pass connection URI as a host, but 127.0.0.1/development is not a valid host name. It means you should specify database parameter separately from the host:
mongodump --host 127.0.0.1 -d development --port 27017 --username user --password pass --out /opt/backup/mongodump-2013-10-07-1