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We develop a hierarchical distributed production planning and control methodology, called DISCS, for a large and unstable semiconductor manufacturing process. The upper layer of DISCS periodically optimizes work-in-process inventory (WIP) levels to meet demands and sets a target WIP level for each workstation. One of key technologies required for the purpose is a fast simulation method to make the iterative optimization process tractable. In the lower layer, dispatching decisions are made at each workstation based on its target WIP level. Computational experiments using wafer fabrication process data show that DISCS, when compared with a traditional control method, succeeds in meeting the demand while keeping lower WIP levels. This indicates that DISCS is a promising methodology for production planning and control in semiconductor manufacturing.