(Adds Chinese Foreign Minister comment on Middle East situation, paragraphs 6-7)

BEIJING, Jan 5 (Reuters) - China said it understood the United States decision to cancel a planned trip to Beijing by U.S. Secretary of State Condoleezza Rice because of the crisis in Gaza, where Israel has launched a ground offensive.

Rice had been set to arrive in Beijing this week to attend celebrations to mark the 30th anniversary of diplomatic ties between the two countries, but the U.S. State Department said on Sunday her deputy, John Negroponte, would go in her place.

U.S. President George W. Bush had explained the cancellation to Chinese President Hu Jintao during a phone call on Sunday night, the Chinese Foreign Ministry said in a statement posted on its website (www.fmprc.gov.cn).

Bush told Hu that Rice needed to remain in the U.S. to "handle relevant matters ... due to the worsening situation in the Middle East," the statement said.

"The Chinese side understands the United States' decision and welcomes Deputy U.S. Secretary of State Negroponte to visit China."

Chinese Foreign Minister Yang Jiechi also talked with Rice about the situation in the Middle East, expressing China's deep concern, the official Xinhua news agency added.

"We hope that parties concerned could halt military operations and armed conflicts immediately, ease the situation and create conditions for continuing to settle disputes through political means," Xinhua quoted Yang as saying.

Rice's visit would have been her last to China as secretary of state under the outgoing Bush administration, and comes after she cancelled her attendance at closing ceremonies for the Beijing Olympics in August due to the crisis in the former Soviet republic of Georgia.

Israeli troops and tanks invaded Gaza by land on Sunday after eight days of air attacks in retaliation for Hamas firing rockets deep into the Jewish territory.

Rice said on Friday she had no plans "at this point" to travel to the Middle East to help reach a ceasefire between Israel and Hamas, which rules Gaza. (Reporting by Ian Ransom and Ben Blanchard; Editing by Jerry Norton)

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