"My goal is that the shredding of chicks should stop by 2017," Agriculture Minister Christian Schmidt said on Thursday.
Around 45 million male chicks are shredded every year in Germany because they cannot produce eggs.
Schmidt had promised a year ago to put a framework in motion to end the mass killings.
Now, the minister hopes to create a system allowing the sex of chicks to be determined before they hatch, and has made over €3 million available to researchers at the University of Leipzig.
The system would bore a hole in the egg's shell, allowing an infrared camera to determine the sex of the embryo inside before sealing the opening again.
But there is no plan to make such a system compulsory for poultry farmers, leading to sharp criticism of Schmidt from animal rights supporters.
"A federal minister who says himself that killing chicks is against the basic principles of the law on protecting animals can only pronounce a ban," the German Animal Rights Federation said on Thursday.
"Voluntary agreements with the poultry industry and research projects are not enough" to stop the animal cruelty, Die Linke (Left Party) MP Birgit Menz said.
Meanwhile, Green representatives in the Bundesrat (upper house of the German parliament) are bringing forward a bill aimed at banning the killing of animals for purely economic reasons.