UPDATE 2-BHP and Australian rivals raise iron ore targets as competition grows
* BHP, Fortescue, Rio squeeze mines for more iron ore
* BHP lifts full-year iron ore guidance by 5 million tonnes
* Says heavy rains over last quarter had little impact
* March quarter iron ore output up 1 pct vs Dec quarter (Adds price forecasts, Fortescue CEO quotes, link to tables)
By James Regan
SYDNEY, April 16 (Reuters) - Australian miners are racing ahead with plans to expand iron ore production to capture more of the Chinese market for the steelmaking ingredient, amid strong competition from the world's biggest supplier Vale of Brazil.
Efforts to beat already ambitious output targets comes as a crackdown in China on using commodities as collateral to raise cash risks unleashing iron ore sales from tens of millions of tonnes sitting in Chinese port warehouses, pressuring prices.
Fortescue Metals Group Ltd, which is raising production 57 percent this year, says its needs iron ore prices to stay between $110-$120 a tonne for the next 12-18 months in order to pay off a targeted $2.5 billion in debt.
The Australian Bureau of Resources and Energy Economics forecast an average price of $110 a tonne this year but only $103 a tonne in 2015. By 2016, Citigroup sees the price falling to $80. Continuación...