Open this PSD file
1: When you open the psd you will notice few lines and blank file . Which is actually our canvas .
2: so now you have an open image which you wanted to cut for Instagram. After importing the image done drop that image on psd file or white canvas
3: After drag and drop check the composition and try to fit as per image nature or strong points of your composition
4: Now click the slice tool (which you can find in crop tool section)
5: Slice tool help you cut the image in two parts. PSD file already optimized to Instagram vertical composition. Just select the one part of the image with slice tool
6 : After that
File > exports >save for the web
7: here you can save the image as per your test to avoid banding in the image try to save in Medium quality option
RESULTS