We tried pg_dump write to a pipe with compressed format and faced issue as in thread referred here.
It was on windows client and for postgres 9.2 version. So during pg_restore, seek error was seen.
With pg_dump writing the dump to a file and then move to another machine for backup, this problem was not there.
But now the issue is that we need to have a lot of free space to write the dump file.
If we use tar format, temporary files created in C:\ take space.
If we use parallel dump format, then also staging the dump output is must.
So trying to understand if the compressed format still needs the staging of output file with the latest versions? Or we can write the output to a pipe to move the data to another machine for backup.
In PG 9.6 (which I have experience with) and beyond, pg_dump --format=directory compresses by default, and on the fly.