Aluminum recycling follows a downcycling dynamic where wrought alloys are transformed into cast alloys, accumulating tramp elements at every cycle. With the saturation of stocks of aluminum and the reduction of the demand for cast alloy due to electrification of transport, improvement in the recycling system must be made to avoid a surplus of unused recycled aluminum, reduce the overall environmental impacts of the industry, and move toward a circular economy. We aim to evaluate the potential environmental benefits of improving sorting efforts by combining operations research, prospective material flow analysis, and life cycle assessment. An optimization defines the optimal sorting to minimize climate change impacts according to different sorting efforts, dismantling conditions, and collection rates. Results show how the improvement of sorting can reduce by around 30% the greenhouse gas emissions of the industry, notably by reducing unused scrap generation and increasing the recycled content of the flows that supply the demand of aluminum. The best performance is achievable with four different sorting pathways. Further improvements occur with a better dismantling and an increase of collection rates, but it requires more sorting pathways. Results point to different closed‐loop recycling initiatives that should be promoted on priority in specific sectors, like the building and construction sector and the aluminum cans industry. To implement a better material circularity, the mobilization of different stakeholders is needed. From a wider perspective, the article shows how operations research can be used to project a circular future in a specific industry. This article met the requirements for a Gold–Gold JIE data openness badge described at http://jie.click/badges.