The unarmed contingent of law enforcement officers were due to head to the location after a deal was struck with rebels aimed at allowing a long-delayed probe into the tragedy to go ahead.
But international observers overseeing the trip had to abruptly ditch their plans after clashes shattered a supposed truce between government forces and insurgents in the area around the site, where some remains of the 298 victims still lie decomposing under the summer sun.
"The security situation on the way to the site and on the site itself is unacceptable for our unarmed observer mission," he told reporters in the insurgent stronghold Donetsk, the biggest city in the region.
An AFP photographer heard artillery bombardments just a kilometre from the rebel-held town of Grabove next to the crash site and saw black smoke billowing into the sky.
Terrified local residents were fleeing and checkpoints controlled by separatist fighters were abandoned.
"The team of 30 Dutch forensic experts currently has no safe access to the disaster site. Because of fighting in the area, the situation is still too unstable to work at the crash site," the ministry said in a statement.
Earlier Australian Prime Minister Tony Abbott said 49 officers from The Netherlands and Australia -- which together lost some 221 citizens in the crash -- were due at the scene today and that there would be "considerably more on site in coming days."
That came after Malaysian Prime Minister Najib Razak said he had reached an agreement with the pro-Russian insurgents controlling the site to allow the police deployment.
So far investigators have been able to visit the site only sporadically because of security concerns.
A truce had been called in the immediate area around the site by both the Kiev forces and pro-Russian separatists, but just 60 kilometres away, the Ukrainian army had continued with their offensive to retake Donetsk.
The industrial hub, which has been serving as a base for international monitors and journalists who are travelling daily to the crash site, came under intense fire overnight.
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